INTERIM SERVICES INC, DEF 14A, 1997-04-10

INTERIM SERVICES INC
DEF 14A, 1997-04-10
HELP SUPPLY SERVICES

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<PAGE>
SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant /X/
Filed by a Party other than the Registrant / /

Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section240.14a-11(c) or
Section240.14a-12

INTERIM SERVICES INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

N/A
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

/X/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1)
and 0-11.
(1) Title of each class of securities to which transaction applies:
-----------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
-----------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
-----------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
-----------------------------------------------------------------------
(5) Total fee paid:
-----------------------------------------------------------------------
/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
-----------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE>
[LOGO]

To our Stockholders:

On behalf of the Board of Directors, it is our pleasure to invite you to
attend the Annual Meeting of Stockholders of Interim Services Inc.

As shown in the formal notice enclosed, the meeting will be held at 10:00
a.m. (Eastern Daylight Time) on Thursday, May 22, 1997 at the executive offices
of the Company, 2050 Spectrum Boulevard, Fort Lauderdale, Florida 33309. At the
meeting, in addition to acting on the matters described in the Proxy Statement,
we will present a current report on the activities of the Company. Stockholders
will have an opportunity at that time to comment on or to inquire about the
affairs of the Company that may be of interest to stockholders generally. If you
will need special assistance at the meeting because of a disability, please
contact Ms. Weatherly Treese.

The Company's audited financial statements, management's discussion and
analysis of financial condition and results of operations, selected five-year
financial data, and quarterly financial data are contained in the enclosed
Appendix A to the Proxy Statement.

We sincerely hope you will be able to attend our Annual Meeting. However,
whether or not you are personally present, it is important that your shares be
represented at this meeting in order that the presence of a quorum may be
assured. Whether or not you plan to attend the meeting, you are urged to date,
sign and mail the enclosed proxy card in the envelope provided.

Thank you for your support.

Sincerely,
Raymond Marcy
PRESIDENT AND
CHIEF EXECUTIVE OFFICER

Allan C. Sorensen
CHAIRMAN
<PAGE>
INTERIM SERVICES INC.

----------------

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
---------------------

TO BE HELD
THURSDAY, MAY 22, 1997
10:00 A.M. EDT

The Annual Meeting of Stockholders of INTERIM SERVICES INC. will be held at
10:00 a.m. (Eastern Daylight Time) on Thursday, May 22, 1997 at the executive
offices of the Company, 2050 Spectrum Boulevard, Fort Lauderdale, Florida 33309.
The meeting will be held for the following purposes:

1. To elect two directors to hold office for three years and until their
successors are elected and shall have qualified.

2. To ratify the appointment of Deloitte & Touche as the Company's
independent auditors for the fiscal period ending December 26, 1997.

3. To approve the Company's 1997 Long Term Executive Compensation and
Outside Director Stock Option Plan.

4. To approve the Company's 1997 Employee Stock Purchase Plan.

5. To approve the Company's Incentive Plan for 162(m) Executives.

6. To transact such other business as may properly come before the meeting
or any adjournment of the meeting.

Only stockholders of record at the close of business on April 3, 1997 are
entitled to notice of, and to vote at, the meeting and any adjournment of the
meeting.

BY ORDER OF THE BOARD OF DIRECTORS
John B. Smith, SECRETARY

Fort Lauderdale, Florida
April 10, 1997

--IMPORTANT--
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE SIGN AND RETURN THE
ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN THE ENCLOSED POST-PAID ENVELOPE. IF
YOU ATTEND THE MEETING AND SO DESIRE, YOU MAY WITHDRAW YOUR PROXY AND VOTE IN
PERSON.
THANK YOU FOR ACTING PROMPTLY.
<PAGE>
INTERIM SERVICES INC.

----------------

PROXY STATEMENT
SOLICITATION OF PROXIES FOR ANNUAL MEETING
---------------------

This Proxy Statement is furnished by the Board of Directors of Interim
Services Inc. ("the Company") to help you exercise your voting rights at the
1997 Annual Meeting of Stockholders of the Company to be held at 10:00 a.m.
(Eastern Daylight Time) on Thursday, May 22, 1997, at the executive offices of
the Company, 2050 Spectrum Boulevard, Fort Lauderdale, Florida 33309, (954)
938-7600, or at any adjournments thereof (the "Annual Meeting"). The
accompanying Proxy Card represents your holdings of the Company's Common Stock,
par value $.01 per share ("Common Stock"), and is being solicited by the Board
of Directors.

INFORMATION FOR STOCKHOLDERS
REGARDING PROXIES AND VOTING

If you are a stockholder of the Company, you can be represented at the
Annual Meeting and have your shares voted as you direct by means of the enclosed
Proxy Card. The affirmative vote of the holders of a majority of all outstanding
shares entitled to vote and present in person or represented by proxy at the
Annual Meeting is required for the adoption of all matters listed in this Proxy
Statement and coming before the meeting. The proxy holders, Roy G. Krause and
John B. Smith, will vote all shares of the Company's stock represented by Proxy
Cards that are properly signed and returned by stockholders. Your shares will be
voted by the proxy holders as you have directed. You may specify your voting
choices by marking the appropriate boxes on the Proxy Card. If you properly sign
and return your Proxy Card, but do not specify your choices, your shares will be
voted as recommended by the Board of Directors. The Proxy Card also authorizes
the proxy holders to vote the shares represented on any matters not known at the
time this Proxy Statement was printed that may properly be presented for action
at the Annual Meeting.

The total number of shares of stock of the Company outstanding and eligible
to vote at the Annual Meeting is 19,578,829 consisting of Common Stock, par
value $.01 per share. Each share of the Company's Common Stock entitles the
holder to one vote with respect to all matters to come before the Meeting, and
all of such shares vote as a single class. Only stockholders of record at the
close of business on April 3, 1997, are entitled to notice of, and to vote at,
the Annual Meeting. The election inspectors appointed for the Annual Meeting
will tabulate all votes cast in person or by proxy and will determine whether or
not a quorum is present. A majority of the outstanding shares entitled to vote,
present in person or represented by proxy, will constitute a quorum at the
meeting. The affirmative vote of the holders of a majority of the shares of
Common Stock represented in person or by proxy at the meeting is required to
approve each matter presented at the meeting. Abstentions and broker non-votes
are counted for purposes of determining the presence or absence of a quorum for
the transaction of business. Abstentions are counted in tabulations, but not as
an affirmative vote, of the votes cast on proposals presented to stockholders,
whereas broker non-votes are not counted for purposes of determining whether a
proposal has been approved.

Solicitation of the proxies will be made by certain directors, officers and
employees of the Company who may do so by telephone, telegram, mail or personal
contact. Arrangements have been made with brokers, nominees and fiduciaries to
send proxies and proxy material at the Company's expense to their principals.
This Proxy Statement is first being mailed on or about April 10, 1997 to
stockholders of record on April 3, 1997.

1
<PAGE>
The Board of Directors encourages you to complete and return the Proxy Card
even if you expect to attend the Annual Meeting. If the enclosed form of proxy
is executed and returned, it may, nevertheless, be revoked at any time before it
is voted by written notice to the Secretary of the Company. If you attend the
Annual Meeting and wish to vote, your ballot at the Annual Meeting will cancel
any proxy that you have previously given.

COMMON STOCK OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT

The following table shows the amount and nature of "beneficial ownership" of
the 19,578,829 shares of Common Stock of the Company, as of April 3, 1997, by
each person known by the Company to be the "beneficial owner" of more than five
percent of such Common Stock, by each present director and nominee for director
of the Company, by the Named Officers in the Summary Compensation Table, and by
all the continuing directors, nominees to the Board of Directors and executive
officers of the Company as a group. The determinations of "beneficial ownership"
of the Company's Common Stock are based upon responses to Company inquiries
which cited Rule 13d-3 under the Securities Act of 1934, as amended (the "1934
Act"). Such Rule provides that shares shall be deemed so owned where a person
has, either solely or in conjunction with others, the power to vote or to direct
the voting of shares and/or the power to dispose, or to direct the disposition
of shares; or where a person has the right to acquire any such power within 60
days after the date such "beneficial ownership" is determined.

AMOUNT AND NATURE OF BENEFICIAL OWNERSHIP

<TABLE>
<CAPTION>
SHARES OF COMMON
STOCK
NAME OF BENEFICIAL OWNER BENEFICIALLY PERCENT OF CLASS
(AND ADDRESS IF BENEFICIAL OWNERSHIP EXCEEDS 5%) OWNED (1) IF MORE THAN 1%
- ----------------------------------------------------------------------------- ----------------- ------------------
<S> <C> <C>
Putnam Investments, Inc. (2) ................................................ 2,331,589 11.9%
One Post Office Square
Boston, MA 02109

T. Rowe Price Associates, Inc. (3) .......................................... 1,375,216 7.0%
100 East Pratt Street
Baltimore, MD 21202

Massachusetts Financial Services Company (4) ................................ 1,326,132 6.8%
500 Boylston Street
Boston, MA 02109

William Blair & Company, L.L.C. (5) ......................................... 1,172,600 6.0%
222 West Adams Street
Chicago, IL 60606

Raymond Marcy................................................................ 88,934 --

Robert E. Livonius........................................................... 45,500 --

Harold Toppel................................................................ 27,673 --

John B. Smith................................................................ 26,621 --

Allan C. Sorensen............................................................ 25,501 --

Gary Peck.................................................................... 24,449 --

Roy G. Krause................................................................ 16,666 --

Jerome B. Grossman........................................................... 11,305 --

William F. Evans............................................................. 11,305 --

Dr. J. Ian Morrison.......................................................... 10,614 --
</TABLE>

2
<PAGE>
<TABLE>
<CAPTION>
SHARES OF COMMON
STOCK
NAME OF BENEFICIAL OWNER BENEFICIALLY PERCENT OF CLASS
(AND ADDRESS IF BENEFICIAL OWNERSHIP EXCEEDS 5%) OWNED (1) IF MORE THAN 1%
- ----------------------------------------------------------------------------- ----------------- ------------------
Steven S. Elbaum............................................................. 10,480 --
<S> <C> <C>

A. Michael Victory........................................................... 8,305 --

Cinda A. Hallman............................................................. 8,305 --

Directors and Executive Officers as a group (23 persons)..................... 409,703 2.1%
</TABLE>

- ------------------------

(1) Unless otherwise indicated in the notes to this Table, the stockholders
listed in the Table have sole voting and dispositive power with respect to
shares beneficially owned by them.

(2) Based on Schedule 13G dated January 27, 1997, and filed with the Securities
and Exchange Commission, Putnam Investments, Inc., and certain of its
subsidiaries including Putnam Investment Management, Inc. and The Putnam
Advisory Company, Inc., are considered "beneficial owners" in the aggregate
of 2,331,589, or 11.9% of shares outstanding, of the Company's common stock,
which shares were acquired for investment purposes by such investment
managers for certain of their advisory clients. Neither Putnam Investments,
Inc. nor its subsidiaries report sole voting power or sole dispositive power
over such shares. Putnam Investments, Inc. has shared dispositive power with
the Putnam Advisory Company, Inc. as to 59,300 shares, and with Putnam
Investment Management, Inc. as to 2,272,289 shares. Putnam Investments, Inc.
has shared voting power with the Putnam Advisory Company, Inc. as to 33,100
of such shares.

(3) Based on Schedule 13G dated February 14, 1997, and filed with the Securities
and Exchange Commission, T. Rowe Price Associates, Inc. is considered a
"beneficial owner" in the aggregate of 1,375,216, or 7.0% of shares
outstanding, of the Company's common stock, which shares were acquired for
investment purposes by such investment manager for certain of its advisory
clients. T. Rowe Price Associates, Inc. asserts sole voting power as to
71,400 of those shares and sole dispositive power with respect to all such
shares.

(4) Based on Schedule 13G dated February 12, 1997, and filed with the Securities
and Exchange Commission, Massachusetts Financial Services Company is
considered a "beneficial owner" in the aggregate of 1,326,132, or 6.8% of
shares outstanding, of the Company's common stock, which shares were
acquired for investment purposes by such investment manager for certain of
its advisory clients. Massachusetts Financial Services Company asserts sole
voting power with respect to 1,227,116 of such shares and sole dispositive
power with respect to all such shares.

(5) Based on a Schedule 13G dated February 14, 1997, and filed with the
Securities and Exchange Commission, William Blair & Company, L.L.C. is
considered a "beneficial owner" in the aggregate of 1,172,600, or 6.0% of
shares outstanding, of the Company's common stock which shares were acquired
for investment purposes by such investment manager for certain of its
advisory clients. William Blair & Company, L.L.C. asserts sole voting power
with respect to 460,967 of those shares and sole dispositive power with
respect to all such shares.

CHANGE IN FISCAL YEAR

During the nine months ended December 30, 1994, the Company changed its
fiscal year from a 52 or 53 week year ending on the last Friday in March to a 52
or 53 week year ending on the last Friday in December. The change in fiscal year
was made to align the Company's year end more closely with the standard for
companies in the staffing industry. Consistent with the Company's financial
reporting, the information presented in this Proxy Statement, including the
audited financial statements for the three years ended December 27, 1996, and
the notes thereto, attached hereto as Appendix A, covers, when applicable, the
twelve month periods ended December 27, 1996, December 29, 1995 and December 30,
1994. The year ended December 30, 1994 contained 53 weeks and the years ended
December 27, 1996 and December 29, 1995 contained 52 weeks.

3
<PAGE>
ELECTION OF DIRECTORS
(ITEM 1 ON PROXY CARD)

The Company's Certificate of Incorporation and Bylaws provide that the
number of directors to constitute the Board of Directors shall be nine unless
otherwise fixed by a resolution adopted by the affirmative vote of the holders
of a majority of the outstanding shares entitled to vote thereon or by a
majority of the whole Board. The Certificate of Incorporation and Bylaws further
provide that the Board of Directors shall be divided into three classes: Class
I, Class II and Class III, with each class to consist, as nearly as possible, of
one-third of the members of the Board. The term of office of one class of
directors shall expire at each annual meeting of stockholders. Directors elected
at an annual meeting of stockholders to succeed those whose terms expire shall
be identified as being of the same class as those directors they succeed and
shall be elected for a term to expire at the third annual meeting of
stockholders after their election.

At the annual meeting of stockholders to be held on May 22, 1997, two Class
I directors will be elected to hold office for three years and until their
successors are elected and shall have qualified. William F. Evans and Cinda A.
Hallman have been nominated for election as Class I directors of the Company and
both of them are currently Class I directors of the Company. The Company has
adopted a mandatory retirement policy whereby directors may not stand for
re-election after the end of the term during which they attain 70 years of age.
Accordingly, Harold Toppel, a current Class I director, will not stand for re-
election at the annual meeting of stockholders. The Nominating Committee has
commenced a search for a new outside director to fill Mr. Toppel's position on
the Board of Directors. The shares voted by the proxies will be voted for the
election of Mr. Evans and Ms. Hallman unless authority to do so is withheld as
provided in the form of proxy. All nominees have consented to serve if elected
and the Board of Directors has no reason to believe that any of the nominees
will be unable to accept the office of director, but if such contingency should
arise, it is the intention of the proxies to vote for such person or persons as
the Board of Directors may recommend.

<TABLE>
<CAPTION>
NAME & AGE PRINCIPAL OCCUPATION AND DIRECTORSHIPS
---------------------------------------------------
<S> <C>
NOMINEES FOR CLASS I
(TERM EXPIRING IN 2000)

William F. Evans (49)....................................... Director of the Company since August 1993.
Executive Vice President, ProSource, Inc., a food
service distribution company, since July 1995.
Consultant to H & R Block from November 1994
through June 1995. Formerly, Senior Vice President,
Corporate Operations, of H&R Block, Inc., from
August 1992 through October 1994; Executive Vice
President and Chief Financial Officer of Dun &
Bradstreet Software Services, Inc., Atlanta,
Georgia, from January 1990 through July 1992.

Cinda A. Hallman (52)....................................... Director of the Company since February 1995. Vice
President, Information Systems and Chief
Information Officer of E. I. DuPont de Nemours &
Co. ("DuPont") since November 1991. Trustee of the
Medical Center of Delaware. Board Chair of the
United Way of Delaware.
</TABLE>

4
<PAGE>
<TABLE>
<CAPTION>
NAME & AGE PRINCIPAL OCCUPATION AND DIRECTORSHIPS
---------------------------------------------------
<S> <C>
CONTINUING DIRECTORS--CLASS II
(TERM EXPIRING IN 1998)

Steven S. Elbaum (48)....................................... Director of the Company since May 1996. Mr. Elbaum
served as a director of Brandon Systems Corp. from
January 1987 until May 1996. Chairman of the Board
and Chief Executive Officer of The Alpine Group,
Inc., a diversified public holding company, since
June 1984. Mr. Elbaum has been Chairman and Chief
Executive Officer of Superior Telecom, Inc., a wire
and cable telecommunications company, since October
1996.

Jerome B. Grossman (77)..................................... Director of the Company since August 1978. Served
as the Executive Vice President and Chief Operating
Officer of H&R Block, Inc. from May 1971 to August
1989 and then as Vice Chairman of the Board until
he retired in July 1992. Served as a Director of
H&R Block, Inc. from September 1973 until Septem-
ber l992, at which time he was elected Vice
Chairman Emeritus.

Allan C. Sorensen (58)...................................... Chairman of the Board of the Company since November
1989; Director since 1967. President of the Company
from 1967 to November 1989; CEO from August 1978 to
September 1991. A Director and Vice Chairman of
Let's Talk Cellular, Inc. since 1994. Temporary
Chairman of The Appletree Companies, Inc. since
August 1996; Director since February 1996.

CONTINUING DIRECTORS CLASS III
(TERM EXPIRING IN 1999)

Raymond Marcy (46).......................................... Director of the Company since November 1989. Chief
Executive Officer of the Company since September
1991; President since November 1989; Chief
Operating Officer from November 1989 until
September 1991.

Dr. J. Ian Morrison (44).................................... Director of the Company since August 1993.
Consultant and Senior Fellow of the Institute for
the Future (IFTF), a non-profit research and
consulting firm, since August 1996; President from
May 1990 until August 1996.
</TABLE>

5
<PAGE>
<TABLE>
<CAPTION>
NAME & AGE PRINCIPAL OCCUPATION AND DIRECTORSHIPS
---------------------------------------------------
<S> <C>
A. Michael Victory (62)..................................... Director of the Company since August 1980.
President of AMEC Capital since January 1993. Since
September 1996, AMEC Capital has been a division of
Burnham Securities, Inc. Prior to that, and for
more than five years, general partner in Cumberland
Investment Group.
</TABLE>

DIRECTORS' COMPENSATION, COMMITTEES AND MEETINGS

Non-employee directors receive an annual retainer of $17,500, which is to be
paid in the form of shares of the Company's Common Stock, as set forth in the
Outside Directors' Compensation Plan. Under such plan, the number of shares
payable as the annual retainer is determined by dividing $17,500 by the closing
price of the Company's Common Stock on the date of the annual meeting of
stockholders. The annual retainer fee is determined as of the date of the annual
meeting of stockholders and is effective on the following July 1 of each year.
Additionally, non-employee directors are entitled to a fee of $2,000 for
attending each Board meeting and $1,000 for attending each Committee meeting
held on a day other than the day of a Board meeting, each payable in cash.
Non-employee directors are reimbursed for expenses which may be incurred by them
in connection with the business and affairs of the Company.

The Company's 1993 Stock Option Plan for Outside Directors (the "Director
Plan") prescribes that each non-employee Director shall receive an annual stock
option of 2,000 shares of the Company's $.01 par value Common Stock at an
exercise price equal to the closing price of such stock on the date of grant
(April 30), which first becomes exercisable one year from the date of grant.
Outside director stock options of 2,000 shares each were granted on April 30,
1995 at an exercise price of $28.875 per share and became fully exercisable on
April 30, 1996. Outside director stock options of 2,000 shares each were granted
on April 30, 1996 at an exercise price of $43.38 per share and will become fully
exercisable on April 30, 1997. In a separate grant of options unrelated to the
Director Plan, stock options of 4,000 shares each, plus an additional 2,000
shares in the case of Mr. Evans who had previously waived his right to receive
an earlier 1994 grant under the Director Plan, were granted on May 11, 1995 at
an exercise price of $24.00, with 50% exercisable on May 11, 1996 and the
remainder exercisable on May 11, 1997. The Outside Directors Stock Option
Committee administers the Director Plan and such Committee may in its sole
discretion (i) determine which Outside Directors of any Subsidiary of the
Company shall be granted stock options, (ii) grant stock options to any Outside
Directors of any Subsidiary of the Company so selected, (iii) determine the
type, date of grant, size and terms of stock options to be granted to Outside
Directors of any Subsidiary of the Company, (iv) determine the terms other than
the date of grant, size and stock option price of stock options granted pursuant
to the Director Plan to Outside Directors of the Company, and (v) place
conditions or restrictions on the receipt of stock options by Outside Directors
of any Subsidiary of the Company or on the payment or exercise of any stock
options. On February 5, 1997, the Board approved the combination of the Director
Plan and the 1993 Long-Term Executive Compensation Plan into the 1997 Long Term
Compensation and Outside Director Stock Option Plan (the "1997 Plan"), subject
to stockholder approval. The 1997 Plan mirrors the Director Plan with respect to
stock option grants to Directors of the Company and its Subsidiaries. The 1997
Plan is being submitted to the stockholders of the Company for approval at the
May 22, 1997 annual meeting (see "APPROVAL OF THE 1997 LONG TERM EXECUTIVE
COMPENSATION AND OUTSIDE DIRECTOR STOCK OPTION PLAN").

The standing committees of the Board include: The Audit Committee, the
Executive Committee, the Compensation Committee, the Nominating Committee and
the Outside Directors Stock Option Committee.

6
<PAGE>
The Audit Committee, whose members are Jerome B. Grossman (Chairman),
William F. Evans, Cinda A. Hallman and Harold Toppel held three meetings during
the twelve months ended December 27, 1996. The functions of the committee
include, among other things, reviewing the various internal accounting controls
of the Company; reviewing and approving the services of the Company's
independent auditors, including any non-audit services provided by them; making
recommendations to the Board of Directors with respect to the employment,
retention or replacement of such auditors, as well as monitoring the
independence of such auditors; and reviewing the scope of the annual audit and
related matters. Also, the Audit Committee receives periodic reports from the
Company's internal auditor.

The Executive Committee, whose members are Raymond Marcy (Chairman), Jerome
B. Grossman, Harold Toppel and A. Michael Victory, held eight meetings during
the twelve months ended December 27, 1996. The primary function of the Executive
Committee is to control and manage, during intervals between meetings of the
Board, the property and business of the Company in all matters in which
exclusive authority has not been given to the entire Board of Directors or in
which specific direction has not been given by the Board.

The Compensation Committee, whose members are William F. Evans (Chairman),
Cinda A. Hallman and J. Ian Morrison, held three meetings during the twelve
months ended December 27, 1996. The functions of the committee primarily include
reviewing the compensation of the Company's executive officers and recommending
to the Board of Directors the salaries, and any bonus or incentive plans, for
such executive officers. The Compensation Committee also determines the amount
and terms of all stock options awarded to employees of the Company.

The Nominating Committee, whose members are A. Michael Victory (Chairman),
Raymond Marcy, J. Ian Morrison and Allan C. Sorensen, held one meeting during
the twelve months ended December 27, 1996. The Nominating Committee is
responsible for the initiation of nominations for election as a director of the
Company.

The Outside Directors Stock Option Committee, consisting of management
Directors Raymond Marcy (Chairman) and Allan C. Sorensen, administers the 1993
Stock Option Plan for Outside Directors, and held no meetings during the twelve
months ended December 27, 1996. As of February 5, 1997, such committee no longer
administers the 1993 Stock Option Plan for Outside Directors. That plan was
combined with the 1993 Long-Term Executive Compensation Plan, to form the 1997
Long-Term Executive Compensation and Outside Director Stock Option Plan (the
"1997 Plan"). The 1997 Plan, which is being submitted to stockholders of the
Company for approval at the 1997 annual meeting, is administered by the
Compensation Committee.

The Board of Directors met eleven times during the twelve months ended
December 27, 1996. There were a total of twenty-six meetings of the Board and
its committees. All directors attended more than seventy-five percent of the
meetings of the Board and the committees on which they served during the past
year.

EXECUTIVE COMPENSATION

The annual and long-term compensation of Raymond Marcy, the Company's Chief
Executive Officer and certain other highly compensated executive officers for
whom such information must be disclosed (the "Named Officers") for the twelve
months ended December 27, 1996, is shown in the tables that follow and discussed
in a report from the Compensation Committee of the Board of Directors.

7
<PAGE>
SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG TERM
ANNUAL COMPENSATION COMPENSATION
----------------------------------------- AWARDS (3)
BONUS ($) OTHER ANNUAL --------------- ALL OTHER
(YEAR COMPENSATION INTERIM STOCK COMPENSATION
NAME AND PRINCIPAL POSITION YEAR(1) SALARY($) EARNED) $(2) OPTIONS #(4) ($)
----------- ----------- ----------- --------------- --------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Raymond Marcy ...................... 1996 $ 487,884 $ 186,985(5) $ 7,318 40,000 $ 1,573(6)
President and Chief 1995 444,231 268,777 4,463 35,000 1,626
Executive Officer 1994 401,278 313,637 3,077 50,000 1,202

Robert E. Livonius ................. 1996 250,903 95,912(7) 3,763 20,000 1,546(6)
Executive Vice 1995 231,153 106,887 2,461 17,500 1,483
President and Chief 1994 212,490 74,305 1,385 25,000 429
Operating Officer

Gary Peck .......................... 1996 238,502 102,069 5,701 10,000 875(6)
Vice President 1995 247,101 95,405 2,906 10,000 864
(Commercial Branch 1994 220,461 53,152 250 15,000 80
Operations)

Roy G. Krause (8) .................. 1996 218,850 86,863(9) 3,283 20,000 71,220(10)
Executive Vice 1995 48,654 22,945 531 -0- 4,830
President and 1994 N/A N/A N/A N/A N/A
Chief Financial Officer

John B. Smith ...................... 1996 178,118 58,988(11) -0- 10,000 2,777(6)
Senior Vice President, 1995 171,176 65,283 -0- 10,000 2,732
Secretary and Legal 1994 164,476 41,319 1,060 15,000 230
Counsel
</TABLE>

- ------------------------------

(1) In 1994, the Company changed its Fiscal Year to the last Friday in December
from the last Friday in the month of March. The figures in this table have
been adjusted to reflect the compensation received in each of the last three
years ended on the last Friday in the month of December.

(2) For 1996, consists of matching contributions paid by the Company on behalf
of its executives to the Interim Deferred Compensation Plan ("IDCP"), and in
the case of Mr. Peck, $2,106 reimbursement for a physical examination.

(3) There were no Restricted Stock Awards, Stock Appreciation Rights or
Long-Term Incentive Plan Payouts to the listed individuals during 1994, 1995
or 1996.

(4) Incentive stock options and non-qualified stock options were granted under
the Company's 1993 Long-Term Executive Compensation Plan at an exercise
price equal to the fair market value of the Company's Common Stock on
January 27, 1994, February 9, 1995, and January 31, 1996, the dates of
grant. These options have ten-year terms (except for those options granted
in 1996 to Messrs. Krause, Livonius and Marcy, which have five year terms)
and become exercisable over a three year period in cumulative increments of
33-1/3% per year beginning with the first anniversary of the date of grant.

(5) Pursuant to the Company's bonus plan for its executives, this includes
payments of $16,347 and $20,638, which amounts were previously deferred
portions of Mr. Marcy's 1994 and 1995 bonuses, respectively.

(6) Includes the imputed economic value of a death benefit provided by the
Company for life insurance purchased by the executive.

(7) Pursuant to the Company's bonus plan for its executives, this includes a
payment of $4,392, which amount was a previously deferred portion of Mr.
Livonius' 1995 bonus.

(8) Mr. Krause joined the Company in October, 1995.

(9) Pursuant to the Company's bonus plan for its executives, this includes a
payment of $1,063, which amount was a previously deferred portion of Mr.
Krause's 1995 bonus.

(10) Includes: $2,261 as the imputed economic value of a death benefit provided
by the Company for life insurance purchased by the Executive; $18,462 as
rent payments paid by the Company; and $50,497 as moving expenses paid by
the Company.

(11) Pursuant to the Company's bonus plan for its executives, this includes a
payment of $2,682, which amount was a previously deferred portion of Mr.
Smith's 1995 bonus.

8
<PAGE>
STOCK OPTIONS

The following table contains information concerning the grant of stock
options to the Named Officers during the twelve months ended December 27, 1996.

OPTION GRANTS IN FISCAL YEAR ENDED DECEMBER 27, 1996

<TABLE>
<CAPTION>
INDIVIDUAL GRANTS POTENTIAL REALIZABLE
------------------------------------------------------ VALUE AT ASSUMED
NUMBER OF ANNUAL RATES OF
SECURITIES STOCK PRICE
UNDERLYING % OF TOTAL APPRECIATION FOR
OPTIONS OPTIONS GRANTED EXERCISE OPTION TERM (2)
GRANTED TO EMPLOYEES IN PRICE EXPIRATION ---------------------
NAME (#)(1) FISCAL YEAR ($/SH) DATE 5% ($) 10% ($)
----------- --------------- ----------- ----------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
Raymond Marcy........................ 40,000 10.2% 37.25 1/31/01 411,660 909,660
Robert E. Livonius................... 20,000 5.1% 37.25 1/31/01 205,830 454,830
Roy G. Krause........................ 20,000 5.1% 37.25 1/31/01 205,830 454,830
John B. Smith........................ 10,000 2.6% 37.25 1/31/06 234,263 593,669
Gary Peck............................ 10,000 2.6% 37.25 1/31/06 234,263 593,669
</TABLE>

- ------------------------

(1) See Note (4) to the Summary Compensation Table for a description of the
terms and other information regarding these options.

(2) The dollar amounts under these columns are the result of calculations at the
5% and 10% rates set by the Commission and are not intended to forecast
possible future appreciation of the Company's stock price, or that such
values will ever be realized.

9
<PAGE>
The following table sets forth information with respect to the Named
Officers concerning the exercise of options during the fiscal year ended
December 27, 1996, and unexercised options held as of the end of that year.

AGGREGATED OPTION EXERCISES IN THE FISCAL YEAR ENDED
DECEMBER 27, 1996 AND THAT YEAR'S END OPTION VALUES

<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS AT
SHARES VALUE OPTIONS AT YEAR END (#) YEAR END ($)(1)
ACQUIRED ON REALIZED -------------------------- --------------------------
NAME EXERCISE (#) ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
------------- ----------- ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Raymond Marcy ................. 9,000 204,750 35,999 80,001 481,655 483,345
President and Chief
Executive Officer

Robert E. Livonius ............ -0- -0- 22,499 40,001 308,320 241,680
Executive Vice
President and Chief
Operating Officer

Gary Peck ..................... 700 17,781 12,133 21,667 165,330 141,670
Vice President
Commercial
Branch
Operations

Roy G. Krause ................. -0- -0- -0- 20,000 -0- -0-
Executive Vice
President and Chief
Financial Officer

John B. Smith ................. -0- -0- 13,333 21,667 183,330 141,670
Senior Vice President,
Secretary and
Legal Counsel
</TABLE>

- ------------------------

(1) The value realized on the exercise of options and the value of unexercised
in-the-money options at year end are determined by subtracting the exercise
price for the options from the fair market value of the shares subject to
the options as of the date of exercise or year end, respectively. There can
be no assurance that the value of "unexercised options" reported above will
be realized, and any gains on exercise will depend on the value of the
Company's Common Stock on the date of exercise.

EMPLOYMENT CONTRACTS

Mr. Marcy is employed under an employment contract dated May 1, 1994,
entered into in connection with his employment as President and Chief Executive
Officer. The term of the contract is for three years and is automatically
renewable for one-year terms thereafter unless, not later than six months prior
to the end of the term, written notice is given by Mr. Marcy or the Company
advising that the term of employment shall not be extended further. Mr. Marcy's
compensation arrangement is noted in the Compensation Committee's Report on
Executive Compensation.

10
<PAGE>
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION IN COMPENSATION
DECISIONS

Dr. Morrison, who served on the Compensation Committee during the twelve
months ended December 27, 1996, is a member of the Company's Health Care
Division Advisory Board, serving at the pleasure of the Company without a
written contract. Dr. Morrison did not receive any compensation as a result of
such membership during the twelve months ended December 27, 1996.

COMPENSATION COMMITTEE REPORT
ON EXECUTIVE COMPENSATION

As a publicly-held company, Interim Services Inc. is strongly committed to
maximizing stockholder value through growth of the business and superior
financial performance. Thus, the compensation objective of the Company is to
ensure that the executive compensation program is adequate both to attract,
retain and motivate experienced and qualified individuals and to provide
significant incentives that are directly linked to the Company's financial
performance and increases in stockholder value, as measured by the Company's
stock price.

It is the Compensation Committee's responsibility to review the Company's
executive compensation program and policies each year and to recommend to the
non-employee members of the Board of Directors the compensation of the Company's
executive officers. The Committee reviews and recommends to the Board of
Directors the compensation of the Chief Executive Officer and the Chairman. The
Chief Executive Officer submits his recommendations for compensation of the
other executive officers to the Compensation Committee for its approval. The
Compensation Committee recommends the compensation of the Chief Executive
Officer, the Chairman and other executive officers, including the other Named
Officers, after consideration of compensation policies and practices of other
companies and consultations with outside compensation consultants. The Committee
also annually reviews the compensation of the twenty highest paid executives of
the Company and its subsidiaries. In 1996, the Committee continued to utilize
the resources of a compensation consultant to review and advise on the Company's
salary, incentive bonus and stock option plans and actions taken by the
Committee in 1996 were consistent with the review and advice of the outside
compensation consultant.

There are three primary components to the executive compensation program at
the Company; (1) base salary, (2) incentive compensation, and (3) stock options.
A fourth component, retirement income, is under active consideration by the
Committee.

BASE SALARY

In setting base salaries, consideration is given to competitive market pay
practices in the temporary service industry, service sector, and general
industry for base salaries paid to senior executives with comparable
qualifications, experience and responsibilities. The objective is to establish a
basic level of compensation that is adequate to attract and retain experienced
and qualified individuals, and to recognize their contributions and increased
responsibilities throughout time.

INCENTIVE COMPENSATION

Incentive compensation is designed to specifically relate executive pay to
company performance. Bonuses under such plans provide financial rewards for
achievement of substantive business results, and where substantive business
results are attained, for the attainment of objectively measured personal
performance goals. The Chief Executive Officer recommends the incentive
compensation of the Company's other executive officers, including the other
Named Officers, and the Committee reviews and approves the final compensation
for these executives, and for the Chief Executive Officer. Bonuses are paid
after the end of the fiscal year if the individual remains in the employ of the
Company and achieves established performance targets. The bonus incentive
requires the attainment of specific per share

11
<PAGE>
earnings growth targets for the Company's stock. The portion of each annual
incentive bonus, if any, which is attributable to the Company exceeding the per
share earnings growth target is, in most cases, deemed a contingent bonus,
payable ratably over the next three fiscal years provided the executive remains
employed at the end of each pay-out year. Furthermore, the contingent portion of
each annual incentive bonus will, except for executives subject to Section 16(b)
of the Exchange Act, be invested and paid out in the form of the Company's
Common Stock. In 1995, the contingent bonuses for the Chief Executive Officer
and four other Executive Officers were deferred as described above. No bonuses
paid in 1996 were deferred.

STOCK OPTION AWARDS

Long-term incentive awards are tied to gains realized from the ownership of
the Company's common stock. The Committee believes that stock options provide
incentives to executives by giving them a strong economic interest in maximizing
stock price appreciation, thereby aligning their interests with the Company's
stockholders. The Committee also believes that, when circumstances permit, stock
options should be awarded to lower levels of employees than may be customary in
some organizations. The Committee believes that such a practice is consistent
with the Board's goals of providing incentives to enhance employee performance
and to encourage stock ownership by a widespread employee population. Since the
Company became a public company in 1994, the Committee has approved annual stock
option awards consistent with the above policies. In certain cases, in order to
attract highly qualified employees, the Committee has also approved the grant of
options upon the hiring of certain key executives. For similar reasons, the
Committee has also approved the grant of stock options to certain key executives
of companies acquired by the Company. The aggregate number of shares reserved
for the stock option program was determined after consultation with the
Company's compensation and financial consultants. Individual awards are
primarily based on the employee's level of responsibility in the Company. Option
exercise prices are set at 100% of the fair market value on date of grant and
the options expire after ten years. Stock options granted to employees become
exercisable on a cumulative basis at an annual rate of 33 and 1/3% of the total
number of shares subject to the option, beginning one year after the date of
grant and generally expire ten years from the date of the grant. Beginning in
1996, the Committee intends to shorten the life of options awarded to
executives. By doing so, the Committee hopes to encourage the earlier exercise
of stock options, thus increasing executive stock ownership. Stock option awards
to executive officers consist of incentive stock options (to the extent
permitted by the Internal Revenue Code) and non-qualified stock options.
Incentive stock options are granted to the remaining eligible employees. The
committee has no plans to grant options for restricted shares, SAR's or other
options that have an exercise price less than the fair market value of the stock
on the date of grant. It is anticipated that additional grants of stock options
will be issued in the future, and this Proxy Statement includes a proposal to
authorize additional shares for stock options which may be granted in 1998.

CHIEF EXECUTIVE OFFICER COMPENSATION

The base salary, incentive compensation and stock option awards for the
Chief Executive Officer are determined by the Committee substantially in
conformity with the policies previously described for all other executives of
the Company. During 1994, the Committee engaged a firm of outside compensation
consultants to assist in evaluating the specific level and components of the
Chief Executive Officer's compensation and the Committee's subsequent actions
regarding the Chief Executive Officer's compensation have been consistent with
the consultant's recommendations. The Board of Directors adopted the Committee's
recommendations that, effective April 1, 1997, the base salary of the Chief
Executive Officer be increased by 10%, from the annual rate of $500,000,
established on April 1, 1996, to an annual rate of $550,000. For 1996, the Chief
Executive Officer earned a bonus of $150,000 under the bonus incentive plan for
executives described above, none of which was deferred under the terms of the
plan. In addition, the Chief Executive Officer received $36,985 from the
deferred portion of his 1994 and 1995 bonus. The Chief

12
<PAGE>
Executive Officer's targeted annual incentive compensation, based entirely on
achieving sustained growth in per share earnings, was established in 1997 at a
level equivalent to 55% of his base salary. It is possible for the Chief
Executive Officer to earn up to 200% of his targeted annual incentive
compensation if the Company's actual increase in profitability exceeds the
defined level by a significant amount.

In 1996, a stock option award of 40,000 shares was granted to the Chief
Executive Officer. The 1996 stock option was determined to be consistent with
the outside compensation conultant's analysis of the practices of other
companies of similar nature and comparable size. Special consideration was given
to the fact that the Company was previously a wholly-owned subsidiary of another
company and the desire to establish a significant alignment of the Chief
Executive Officer's long-term economic interests with those of the Company's
stockholders. It is anticipated that additional grants of stock options will be
issued to the Chief Executive Officer in the future.

The Employment Agreement of the Chief Executive Officer was effective May 1,
1994 and has a term of three years with provisions for automatic annual renewals
subject to a prior notice not to extend the term. Salary, incentives and stock
option awards are to be determined by the Committee. The Employment Agreement
also provides for the continuation of the Chief Executive Officer's annual
salary for the remaining term of employment and the vesting of outstanding stock
options if the Chief Executive Officer's employment is terminated without good
cause or as a result of retirement or a change in control.

COMPLIANCE WITH INTERNAL REVENUE CODE SECTION 162(M)

Section 162(m) of the Internal Revenue Code generally disallows a deduction
to publicly traded companies to the extent of excess compensation over
$1,000,000 paid to a Chief Executive Officer or to any of the four other most
highly compensated executive officers, unless such excess compensation is paid
pursuant to a plan which is solely based on objective performance criteria and
is approved by the stockholders.

On February 17, 1997, the Committee adopted a new Incentive Plan for 162(m)
Executives (the "162(m) Incentive Plan") subject to the approval of the
Company's stockholders, so that in 1997 and subsequent years, the compensation
paid pursuant to the plan may be deductible in computing the Company's taxes
under the Internal Revenue Code without regard to the $1,000,000 deduction
limit. The new 162(m) Incentive Plan merely creates the framework for obtaining
an income tax deduction and does not provide any new benefits to or result in
any changes to the incentive bonus plans of the executives covered thereby. The
terms of the new 162(m) Incentive Plan are summarized in this Proxy Statement
and the Plan is set forth in Exhibit III. The committee believes that it is in
the best interest of the stockholders to approve the Plan by voting "Yes" to
Item 5 on the Proxy Card.

EMPLOYEE STOCK OWNERSHIP

The Committee endorses the concept that executive officers, individually and
as a group, should have a significant ownership stake in their Company.
Moreover, the Committee supports reasonable policies that encourage ownership of
Company stock at all levels of employment. Because of the circumstances of the
Company's initial public offering in 1994, in which H & R Block, Inc. sold 100%
of its interest in the Company to the public, there were limited opportunities
for executives and other employees to acquire Company stock. The Board of
Directors has provided for opportunities to acquire Company stock by way of
stock options, partial payment of bonuses in Company stock and investment in
Company stock by its 401K plan. However, the Committee believes that additional
steps should be taken to encourage executives to own a higher level of Company
stock. Accordingly, the Committee has recommended adoption of and the Board of
Directors has adopted the 1997 Employee Stock Purchase Plan summarized earlier
in the Proxy Statement and set forth in full in Exhibit II.

13
<PAGE>
The Committee is also committed to the concept of stock ownership guidelines
for key executives and is studying possible methods by which the Company may
assist key executives in meeting stock ownership guidelines which the Committee
is considering. The Committee expects to take further action with respect to
these matters in 1997.

BY THE COMPENSATION COMMITTEE: William F. Evans, Chairman
Cinda A. Hallman
Dr. J. Ian Morrison

14
<PAGE>
PERFORMANCE GRAPH

The following graph sets forth the cumulative total stockholder return on
the Company's Common Stock for the period beginning January 27, 1994 (the date
of the Company's initial public offering) and ended December 27, 1996, as well
as the cumulative total return of the Standard and Poor's 500 stock index and a
Peer Group Index, for the same time period. The total cumulative return on
investment (change in stock price plus reinvested dividends, if any) for the
Company, the Standard and Poor's 500 stock index and the Peer Group Index is
based on stock prices as of January 27, 1994, assuming a $100 investment. The
Company has not declared any dividends in the period represented in this
performance graph.

The Peer Group Index is comprised of the following publicly traded
companies: CDI Corporation; Kelly Services, Inc.; Manpower Inc.; The Olsten
Corporation; Robert Half International, Inc.; Staff Builders, Inc.; and Uniforce
Services, Inc.

The data for this performance graph was compiled by the Company from
Bloomberg Financial Services. The stock price performance shown on this graph is
not necessarily indicative of future price performance of the Company's Common
Stock.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

<TABLE>
<CAPTION>
INTERIM SERVICES
INC. S&P 500 COMPOSITE PEER GROUP
<S> <C> <C> <C> <C> <C> <C>
1/27/94 $100 $100 $100
3/25/94 124 93 94
6/24/94 116 93 108
9/23/94 122 97 116 .
12/30/94 123 96 121
3/31/95 149 105 142
6/30/95 125 114 119
9/29/95 135 123 133
12/29/95 174 129 134
3/29/96 191 135 166
6/28/96 215 141 180
9/27/96 211 144 171
12/27/96 175 159 158
</TABLE>

15
<PAGE>
APPOINTMENT OF AUDITORS
(ITEM 2 ON PROXY CARD)

Deloitte & Touche audited the accounts of the Company for the twelve months
ended December 27, 1996. Deloitte & Touche has offices or affiliates convenient
to most of the Company's operations in the United States and other countries and
is considered to be well qualified. The Board of Directors has appointed such
firm as the Company's independent auditors for the fiscal period ending December
26, 1997, and recommends that the stockholders ratify such appointment.
Representatives of Deloitte & Touche expect to attend the annual meeting, will
be afforded an opportunity to make a statement if they desire to do so, and will
be available to respond to appropriate questions by stockholders.

Proxies solicited by the Board of Directors will be voted for ratification
of the appointment of Deloitte & Touche in the absence of instructions to the
contrary.

APPROVAL OF THE 1997 LONG-TERM
EXECUTIVE COMPENSATION AND OUTSIDE DIRECTOR
STOCK OPTION PLAN
(ITEM 3 ON PROXY CARD)

INTRODUCTION

Both the Company's 1993 Long-Term Executive Compensation Plan ("Executive
Plan") and the Company's 1993 Stock Option Plan for Outside Directors (the
"Director Plan") (collectively, the "Option Plans") were adopted by the Board of
Directors of the Company on November 18, 1993, and approved by the then sole
stockholder of the Company on November 18, 1993. The Option Plans have been
amended by the Board on February 10, 1995 and February 1, 1996, and such
amendments were approved by the Company's stockholders on May 11, 1995 and May
7, 1996, respectively. For ease of uniform administration and recordkeeping, and
in light of recent regulatory changes which would allow for such changes, on
February 5, 1997, the Board approved the combination of the Executive Plan and
the Director Plan into one plan to be known as the 1997 Long-Term Executive
Compensation and Outside Director Stock Option Plan (the "1997 Plan"), subject
to stockholder approval. The terms of the 1997 Plan are substantially similar to
those of the respective Option Plans. Upon stockholder approval, the 1997 Plan
will replace the Option Plans and the Executive Plan and Director Plan will be
eliminated. The effect of approving the 1997 Plan will be to approve the merger
of the Option Plans into one plan and the increase in the authorized shares
subject to the 1997 Plan by 850,000.

The Board of Directors believes that the Option Plans have been effective in
attracting executives, key employees and non-employee directors to the Company
and its subsidiary corporations, providing long-term incentives and rewards to
those executives and key employees responsible for the continued growth of the
Company and securing for the Company and its stockholders the benefits of stock
ownership in the Company by executive officers and outside directors. The Board
of Directors also believes that incentive stock options and non-qualified stock
options granted under the Executive Plan have provided a form of incentive that
aligns the economic interests of management and other key employees with those
of the Company's stockholders. The Board of Directors further believes that the
continued services of qualified outside directors are essential to the sustained
progress of the Company and its subsidiaries and that options granted pursuant
to the Director Plan have provided additional incentive for outside directors to
promote the success of the Company. The Board of Directors desires to carry
forward these goals and purposes in the combined 1997 Plan.

Approval of the 1997 Plan by the stockholders is desirable to qualify the
annual formula grants to the Company's Outside Directors under the 1997 Plan
under the available exemptions contained in Rule 16b-3 promulgated under the
Securities Exchange Act of 1934, as amended (the "1934 Act"). Qualification
under Rule 16b-3 is necessary to exempt transactions involving securities
granted under the 1997 Plan from the short-swing profit liability provisions of
Section 16(b) of the 1934 Act. Additionally, approval by the

16
<PAGE>
stockholders enables the Company to apply for the listing on the New York Stock
Exchange of the shares of common stock reserved for issuance under the 1997 Plan
(in excess of the 1,550,000 shares previously approved by stockholders under the
Director Plan and the Executive Plan). Stockholder approval is also desired so
that the 1997 Plan may qualify for certain exemptions under Section 162(m) of
the Internal Revenue Code of 1986, as amended (the "Code").

The Board of Directors of the Company believes that the 1997 Plan and its
approval by the stockholders of the Company are in the best interests of the
Company. Accordingly, the Board recommends approval of the 1997 Plan by the
stockholders.

MATERIAL FEATURES OF THE PLAN

The following discussion summarizes the material features of the 1997 Plan,
which are substantially similar to those of the Executive Plan and Director
Plan. For a discussion of the primary differences between the 1997 Plan and the
Director Plan and Executive Plan, see discussion under the section entitled
"Shares Subject to the 1997 Plan." The following discussion is, however,
qualified in its entirety by reference to the full text of the 1997 Plan, which
is attached to this proxy statement as Exhibit I.

SHARES SUBJECT TO THE 1997 PLAN

Historically, the Company has authorized an aggregate number of shares of
Common Stock for use under either of the Executive Plan or the Director Plan,
with the current authorization of an aggregate of 1,550,000 shares. Of these,
options for 98,784 and 2,000 shares have been exercised under the Executive Plan
and the Director Plan, respectively. All of the remaining authorized shares are
allocated for outstanding unexercised stock option grants under the Option Plans
(all of which would again become available under the plans upon lapse or
forfeiture). Currently, there are no shares available for additional grants
under the Option Plans.

Authorization of additional shares is necessary in order to make additional
awards under the 1997 Plan (the combination of the Executive Plan and the
Director Plan) and for the Company to continue to receive the benefits
associated with the 1997 Plan. Accordingly, the 1997 Plan authorizes up to
2,400,000 shares of Common Stock for issuance in accordance with the plan terms.
Shares not issued under the Option Plans will be available for grants under the
1997 Plan. The total number of shares available for issuance under the Option
Plans and the 1997 Plan shall not exceed 2,400,000. All of such shares may be
issued or issuable under the 1997 Plan in connection with the exercise of
incentive stock options. Shares of Common Stock not actually issued pursuant to
an award shall be available for future awards. Shares of Common Stock to be
delivered or purchased under the 1997 Plan may be either authorized but unissued
Common Stock or treasury shares. The 1997 Plan also limits the total number of
shares of common stock with respect to which stock options may be granted to any
recipient during any calendar year to 100,000 shares.

INTEREST IN THE 1997 PLAN

Because of their status as executive officers of the Company and due to
their eligibility for the grant of stock options under the 1997 Plan, the
executive officers may be considered to have a direct interest in the approval
of the 1997 Plan by the stockholders of the Company. The executive officers of
the Company are: Shannon Allen, Philip Baird, James Booth, Ronald de Heer,
Robert Evans, Kathleen Gilmartin, Richard Gorman, Paul Haggard, Roy G. Krause,
Robert Livonius, Marjorie Mangle, Raymond Marcy, Gary Peck, John B. Smith, Allan
C. Sorensen and Wayne Stickles. Because of their status as Outside Directors of
the Company and, in some cases, as nominees for election as directors of the
Company, and due to their eligibility for the grant of stock options under the
1997 Plan, Steven S. Elbaum, William F. Evans, Jerome B. Grossman, Cinda A.
Hallman, Dr. J. Ian Morrison, Harold Toppel and A. Michael Victory may also be
considered to have a direct interest in the approval of the 1997 Plan by the
stockholders of the Company.

17
<PAGE>
However, neither the 1997 Plan nor any option granted thereunder confers any
right upon a person to continue as a director or executive officer of the
Company or interferes in any way with either the right of the Board of Directors
or stockholders of the Company to terminate the directorship or employment of a
person or the person's right to terminate his or her directorship or employment
at any time.

ADMINISTRATION

The Plan shall be administered by the Compensation Committee (the
"Committee") consisting of non-employee directors of the Company, to be
appointed by and to serve at the pleasure of the Board of Directors of the
Company. The Committee shall have full power and authority to construe,
interpret and administer the 1997 Plan and, subject to the powers specifically
reserved to the Board of Directors and subject to the other provisions of the
1997 Plan, to make determinations which shall be final, conclusive and binding
upon all persons. The Committee from time to time may adopt rules, regulations
and policies for carrying out the 1997 Plan. Such policies may include, but need
not be limited to, the type, size and terms of awards to be made to the employee
participants ("Recipients") and certain awards to Outside Directors of the
Company's subsidiaries under the 1997 Plan and the conditions for payment of
such awards.

ABSOLUTE DISCRETION

The Committee may, in its sole discretion, at any time and from time to time
during the continuance of the 1997 Plan, (i) determine which employees of the
Company shall be granted Awards (as defined in "Types of Awards," below) under
the 1997 Plan, (ii) grant to any employee so selected such an Award, (iii)
determine the type, size and terms of Awards to be granted, (iv) establish
objectives and conditions for granting Awards to Recipients, (v) place
conditions or restrictions on the payment or exercise of Awards, and (vi) do all
other things necessary and proper to carry out the intentions of this Plan.

TYPES OF AWARDS

Awards to Recipients under the 1997 Plan may include, but need not be
limited to, shares of Common Stock, restricted shares of Common Stock
("Restricted Shares"), incentive stock options, stock options, stock
appreciation rights, performance shares and performance units (collectively,
"Awards"). The amount of each Award may be based upon the market value of a
share of Common Stock. The Committee may make any other type of Award to
Recipients which it shall determine is consistent with the objectives and
limitations of the 1997 Plan. The Committee may establish performance goals to
be achieved within such Performance Periods as may be selected by it using such
measures of the performance of the Company it may select as a condition to the
receipt of the Award.

In addition to the Awards granted to Recipients, as of April 30 of each
year, each Outside Director who is a member of the Company's Board of Directors
shall be granted a stock option to purchase 2,000 shares of Common Stock. The
Committee may grant stock options to purchase shares of Common Stock to Outside
Directors of the Company's subsidiaries at such times as the Committee, in its
sole discretion, may determine. The Committee may require that all stock options
granted to Outside Directors ("Outside Director Stock Options") be exercised
prior to an Outside Director's termination of service as a Director.

The Committee may determine that all or a portion of an Award (other than
Outside Director Stock Options, which vest one year from the date of grant) or a
payment to a Recipient pursuant to an Award, in any form whatsoever, shall be
vested at such times and upon such terms as may be selected by it. The Committee
may determine that the receipt of all or a portion of an Award or a payment to a
Recipient pursuant to an Award, in any form whatsoever, shall be deferred.
Deferrals shall be for such periods and

18
<PAGE>
upon such terms as the Committee may determine. The Committee may also provide,
in its sole and absolute discretion, that a Recipient to whom an Award is
payable in whole or in part at a future time in shares of Common Stock shall be
entitled to receive an amount per share equal in value to the cash dividends
paid per share on issued and outstanding shares as of the dividend record dates
occurring during the period from the date of the Award to the date of delivery
of such share to the Recipient. The Committee may also authorize, in its sole
and absolute discretion, payment of an amount which a Recipient would have
received in interest on (i) any Award payable at a future time in cash during
the period from the date of the Award to the date of payment, and (ii) any cash
dividends paid on issued and outstanding shares as of the dividend record dates
occurring during the period from the date of an Award to the date of delivery of
shares pursuant to the Award.

ELIGIBLE EMPLOYEES

Awards may be granted to any employee of the Company. No member of the
Committee (other than an ex officio member) shall be eligible for grants of
Awards as a Recipient under the 1997 Plan, although such member may be eligible
for grants of Outside Director Stock Options. A Recipient may be granted
multiple forms of Awards under the 1997 Plan. Subject to the total number of
shares of Common Stock issuable under the 1997 Plan, incentive stock options may
be granted under the 1997 Plan to a Recipient for any number of shares of Common
Stock, subject to the limitation that the aggregate fair market value of such
shares of Common Stock (determined as of time the incentive stock option is
granted) with respect to which incentive stock options are exercisable for the
first time by such Recipient during any calendar year under the Plan and any
other "incentive stock option plans" (as defined in the Code) maintained by the
Company shall not exceed $100,000.

AWARDS TO BE GRANTED UNDER THE 1997 PLAN

Set forth under the section entitled "Executive Compensation" is information
concerning the type and amount of grants under the Executive Plan and Director
Plan made by the Committee to eligible employees and Outside Directors of the
Company. The exact types and amounts of any Awards to be made by the Committee
in the future to any eligible employees pursuant to the 1997 Plan are not
presently determinable. However, Outside Directors who are members of the
Company's Board of Directors will receive an automatic grant of 2,000 Stock
Options each April 30. As a result of the discretionary nature of the 1997 Plan
with respect to Company employees and Outside Directors of the Company's
subsidiaries, it is not possible to state who the participants in such Plan will
be, the numbers of options or other Awards to be received by any person or
group, or the benefits or amounts that would have been received by certain
persons or groups under such Plan. The Committee presently expects that Awards
of incentive stock options and stock options will be made if the 1997 Plan is
approved by the stockholders, but the eligible employees to whom such incentive
stock options and stock options are not yet determinable. In the exercise of its
discretion under the 1997 Plan, the Committee may choose to grant other types of
Awards under such Plan or may choose to grant no Awards under such Plan.
However, the Committee does not presently intend to grant Restricted Shares,
stock appreciation rights or other Awards which have an exercise price less than
the market value of the Award on the date of grant.

NON-ASSIGNABILITY

No Award or Outside Director Stock Option granted pursuant to the 1997 Plan
shall be transferable or assignable by the Recipient other than by will or the
laws of descent and distribution and during the lifetime of the Recipient shall
be exercisable or payable only by or to him or her.

STOCK OPTION PRICE

The purchase price per share of Common Stock under each stock option
(including Outside Director Stock Options) shall be equal to the closing price
for the Common Stock on the New York Stock Exchange

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<PAGE>
(or on the principal securities exchange or other market on which the Common
Stock is then being traded) on the date the stock option or incentive stock
option is granted or if such closing price is not reported on the date of grant,
the last reported closing price). Payment for exercise of any stock option shall
be made (a) in cash, or (b) by delivery of Common Stock having a market value
equal to the aggregate option price, or (c) by a combination of payment of cash
and delivery of Common Stock in amounts such that the amount of cash plus the
market value of the Common Stock equals the aggregate option price.

STOCK APPRECIATION RIGHT VALUE

The base value per share of Common Stock covered by an Award in the form of
a stock appreciation right shall be the market value of one share of Common
Stock on the date the Award is granted.

CONTINUATION OF EMPLOYMENT

The Committee shall require that a Recipient be an employee of the Company
at the time an Award is made and vested. The Committee may provide for the
termination of an outstanding Award if a Recipient ceases to be an employee of
the Company and may establish such other provisions with respect to the
termination or disposition of an Award on the death or retirement of a Recipient
as it, in its sole discretion, deems advisable. The Committee shall have the
sole power to determine the date of and the circumstances which shall constitute
a cessation of employment and to determine whether such cessation is the result
of retirement, death or any other reason.

EMPLOYMENT STATUS

No Award shall be construed as imposing upon the Company the obligation to
continue the employment of a Recipient. No employee or other person shall have
any claim or right to be granted an Award under the Plan.

ANTI-DILUTION PROTECTION

In the event of any changes in the capital structure of the Company,
including but not limited to a change resulting from a stock dividend or
split-up, or combination or reclassification of shares, the Board of Directors
shall make such equitable adjustments with respect to Awards and Outside
Director Stock Options or any other provisions of the 1997 Plan as it deems
necessary and appropriate, including, if necessary, any adjustment in the
maximum number of shares of Common Stock subject to the 1997 Plan or the number
of shares of Common Stock subject to an outstanding Award or Outside Director
Stock Option. If the Company shall become a party to any corporate merger,
consolidation, major acquisition of property for stock, reorganization, or
liquidation, the Board of Directors may make such arrangements it deems
advisable with respect to outstanding Awards or Outside Director Stock Options,
which shall be binding upon Recipients of outstanding Awards and all optionees
of stock options granted to Outside Directors, including, but not limited to,
the substitution of any new Awards or stock options then outstanding, the
assumption of any such Awards or stock options and the termination of or payment
for such Awards or stock options.

MARKET VALUE RESTRICTIONS

The amounts of certain Awards are based on the market value of a share of
Common Stock at a specified point in time. The exercise price per share of
Common Stock under each incentive stock option or stock option granted under the
1997 Plan, which is paid to the Company at the time of exercise, shall be
determined by the Committee, but shall not be less than the closing market price
of such Common Stock on the day of grant of such option. The exercise price for
each option will remain constant during the life of the option, subject to
adjustment pursuant to the anti-dilution provisions of the 1997 Plan described
above. The market value of a share of Common Stock on the date a stock
appreciation right is granted

20
<PAGE>
shall be the base value of such stock appreciation right. On April 3, 1997, the
last reported sale price of the Common Stock on The New York Stock Exchange was
$38.375 per share.

FEDERAL INCOME TAX CONSEQUENCES

The Company has been advised by its counsel that the federal income tax
consequences of the grant and/or exercise of Awards and Stock Options under the
1997 Plan are as described below. The following information is not a definitive
explanation of the tax consequences of the Awards. Recipients should consult
with their own tax advisors with respect to the tax consequences inherent in the
ownership and/or exercise of the Awards, and the ownership and disposition of
any underlying securities.

COMMON STOCK AWARDS; RESTRICTED SHARES. Under the Code, the federal
income tax consequence to the recipient of a Common Stock award or an
award of Restricted Shares will depend on the facts and circumstances of
each such award, and, in particular, the nature of the restrictions
imposed with respect to the shares of stock which is the subject of such
award. In general, if the stock which is the subject of the Common Stock
or Restricted Share award is actually issued to the recipient but is
subject to a "substantial risk of forfeiture," e.g., if the rights to
ownership of the stock are conditioned upon the future performance of
substantial services by the recipient, a taxable event occurs only when
the risk of forfeiture ceases and not before. So long as the sale of
stock at a profit could subject the recipient to suit under Section
16(b) of the Securities Exchange Act of 1934, the stock is considered to
be subject to a "substantial risk of forfeiture." At such time as the
substantial risk of forfeiture ceases, the recipient will realize
ordinary income to the extent of the excess of the fair market value of
the stock on the date the risk of forfeiture terminates over the
recipient's cost of such stock (if any), and the same amount is
deductible by the Company as compensation. Under certain circumstances,
the recipient, by making an election under Section 83(b) of the Code,
can accelerate the taxable event with respect to the stock, in which
event the ordinary income amount and the Company's deduction will be
measured and timed as of the date the stock is deemed, for Section 83(b)
purposes, to have been transferred to the recipient. If the restrictions
with respect to the stock which is the subject of such a Common Stock or
Restricted Share award, by their nature, do not subject the recipient to
a "substantial risk of forfeiture" of the stock, then the recipient will
realize ordinary income with respect to the stock to the extent of the
excess, at the time of grant, of the fair market value of the stock over
the recipient's cost therefor, if any; and the same amount is then
deductible by the Company.

Any disposition of shares after restrictions lapse will be subject
to the regular rules governing long-term and short-term capital gains
and losses, with the basis for this purpose equal to the fair market
value of the shares at the end of the restricted period (or the date of
the receipt of the Restricted Shares, if the employee elects to be taxed
on the fair market value upon such receipt). Dividends received by a
recipient during the restricted period will be taxable to the recipient
at ordinary income tax rates and will be deductible by the Company
unless the recipient has elected to be taxed on the fair market value of
the Restricted Shares upon receipt, in which case they will thereafter
be taxable to the employee as dividends and will not be deductible by
the Company.

INCENTIVE STOCK OPTIONS. The 1997 Plan qualifies as an incentive
stock option plan within the meaning of Section 422 of the Code. A
recipient who is granted an Incentive Stock Option will not recognize
any taxable income for federal income tax purposes either on the grant
or exercise of the Incentive Stock Option. However, the excess of the
fair market value of the Common Stock received upon the exercise of the
Incentive Stock Option over the exercise price is included in the
recipient's alternative minimum taxable income and may be subject to
alternative minimum tax ("AMT"). For AMT purposes only, the basis of the
Common Stock acquired upon the exercise of the Incentive Stock Option is
increased by the amount of such excess ("AMT Basis").

21
<PAGE>
If the recipient disposes of the shares purchased pursuant to the
Incentive Stock Option more than two years after the date of grant and
more than one year after the transfer of the shares to him (the required
statutory "holding period"), (a) the recipient will recognize long-term
capital gain or loss, as the case may be, equal to the difference
between the selling price and the exercise price; and (b) the Company
will not be entitled to a deduction with respect to the shares of stock
so issued. For AMT purposes, the gain is the difference between the
sales price and the AMT Basis.

If the holding period requirements are not met, any gain realized
upon disposition will be taxed as ordinary income to the extent of the
excess of the lesser of (i) the fair market value of the shares at the
time of exercise, or (ii) the amount, if any, realized on the
disposition, over the exercise price. The Company will be entitled to a
deduction in the year of disposition in an amount equal to the ordinary
income recognized by the recipient. Any additional gain will be taxed as
short-term or long-term capital gain depending upon the holding period
for the stock. For AMT purposes, the gain is the difference between the
sales price and the AMT Basis.

NONQUALIFIED STOCK OPTIONS. The recipient of a nonqualified stock
option under the 1997 Plan will not recognize any income for federal
income tax purposes on the grant of the option. Generally, on the
exercise of the option, the recipient will recognize taxable ordinary
income equal to the difference between the fair market value of the
shares on the exercise date and the exercise price for the shares. The
Company generally will be entitled to a deduction on the date of
exercise in an amount equal to the ordinary income recognized by the
recipient. Upon disposition of the shares purchased pursuant to the
stock option, the recipient will recognize long-term or short-term
capital gain or loss, as the case may be, equal to the difference
between the amount realized on such disposition and the basis for such
shares, which basis will include the amount previously recognized by the
recipient as ordinary income.

STOCK APPRECIATION RIGHTS. A recipient who is granted stock
appreciation rights will not recognize any taxable income on the receipt
of the stock appreciation rights. Upon the exercise of stock
appreciation right, (a) the recipient will recognize ordinary income
equal to the amount received (the increase in the fair market value of
one share of the Common Stock from the date of grant of the stock
appreciation right to the date of exercise); and (b) the Company will be
entitled to a deduction on the date of exercise in an amount equal to
the ordinary income recognized by the recipient.

PERFORMANCE SHARES AND PERFORMANCE UNITS. A recipient of
performance shares or performance units will not recognize any income
for federal income tax purposes on the date of the grant of the right to
receive performance shares or units. The recipient will recognize
ordinary income for federal income tax purposes at the time of receipt
of cash and/or Common Stock with respect to the performance shares or
units in an amount equal to the sum of the amount of cash received plus
the excess, if any, of the fair market value of the performance shares
or units on the date received over the recipient's cost of such
performance shares or units on the date of grant. The Company will be
entitled to a deduction on the date of receipt of the performance shares
or units by the recipient in an amount equal to the ordinary income
recognized by the recipient. Upon disposition of any stock received, the
recipient will recognize long-term or short-term gain or loss depending
upon the period for which he or she has held the stock in an amount
equal to the difference between the selling price and the fair market
value of the stock on the date of receipt.

AMENDMENTS AND TERMINATION

The Board of Directors of the Company shall have the right at any time
during the continuance of the 1997 Plan to amend, modify, supplement, suspend or
terminate the 1997 Plan, provided that in the absence of the approval of the
holders of a majority of the shares of Common Stock of the Company present in

22
<PAGE>
person or by proxy at a duly constituted meeting of the stockholders of the
Company, no such amendment, modification or supplement shall (i) increase the
aggregate number of shares which may be issued under the 1997 Plan, unless such
increase is by reason of any change in capital structure, (ii) change the
termination date of the 1997 Plan, or (iii) delete or amend the market value
restrictions contained in the 1997 Plan, and provided further, that no
amendment, modification or termination of the 1997 Plan shall in any manner
affect any Award or Outside Director Stock Option of any kind granted under the
1997 Plan without the consent of the Recipient of the Award or the optionee of a
Stock Option, as the case may be, unless such amendment, modification or
termination is by reason of any change in capital structure or unless the same
is by merger, consolidation, reorganization, liquidation or similar occurrence.

The Committee may grant Awards and Outside Director Stock Options at any
time prior to February 5, 2007, on which date the 1997 Plan will terminate
except as to Awards and stock options then outstanding thereunder, which Awards
and stock options shall remain in effect until they have expired according to
their terms or until February 5, 2017, whichever first occurs. No Incentive
Stock Option shall be exercisable later than 10 years following the date it is
granted.

RECOMMENDATION OF THE BOARD OF DIRECTORS "FOR" THIS PROPOSAL

The Board of Directors believes that the 1997 Plan will promote the
interests of the Company and its stockholders and enable the Company and its
subsidiary corporations to continue to attract, retain and reward persons
important to the Company's success. The 1997 Plan, the terms of which are not
significantly different from the replaced Option Plans, is designed to enhance
the identity of the interests of the plan participants with the interests of the
Company's stockholders. As such, the Board of Directors believes that the 1997
Plan is in the best interests of the Company and its stockholders. Accordingly,
THE BOARD OF DIRECTORS RECOMMENDS APPROVAL OF THE 1997 PLAN AND PROXIES
SOLICITED BY THE BOARD WILL BE SO VOTED IN THE ABSENCE OF INSTRUCTIONS TO THE
CONTRARY.

OTHER INFORMATION

Information as to certain benefit plans currently in effect or proposed for
directors, officers and employees of the Company is set forth in the sections of
this proxy statement entitled, "DIRECTORS' COMPENSATION, COMMITTEES AND
MEETINGS," "EXECUTIVE COMPENSATION," "APPROVAL OF 1997 EMPLOYEE STOCK PURCHASE
PLAN" and "APPROVAL OF THE INCENTIVE PLAN FOR 162(m) EXECUTIVES."

23
<PAGE>
NEW PLAN BENEFITS

The following table contains information concerning all recipients of the
stock options granted, through the date of this Proxy Statement, pursuant to the
1993 Long-Term Executive Compensation Plan and the 1993 Stock Option Plan for
Outside Directors, as continued in the 1997 Long-Term Executive Compensation and
Outside Director Stock Option Plan and their aggregate dollar value based on
their respective dates of grant.

<TABLE>
<CAPTION>
1997 LONG-TERM
EXECUTIVE COMPENSATION
AND OUTSIDE DIRECTOR
STOCK OPTION PLAN (1)
------------------------
DOLLAR NUMBER OF
NAME AND POSITION VALUE ($) UNITS
------------ ----------
<S> <C> <C>
Raymond Marcy.......................................................................... 5,227,500 175,000
President and Chief Executive Officer

Robert E. Livonius..................................................................... 2,613,750 87,500
Executive Vice President and Chief Operating Officer

Gary Peck.............................................................................. 1,481,250 50,000
Vice President
Commercial Branch Operations

John B. Smith.......................................................................... 1,369,500 47,000
Senior Vice President
Secretary and Legal Counsel

Roy Krause............................................................................. 1,676,250 45,000
Executive Vice President and Chief Financial Officer

Executive Group (2).................................................................... 20,362,178 668,687

Non-Executive Director Group (3)....................................................... 1,651,000 58,000

Non-Executive Officer Employee Group (4)............................................... 32,016,771 1,021,924
</TABLE>

- ------------------------

(1) See discussion under "APPROVAL OF THE 1997 LONG-TERM EXECUTIVE COMPENSATION
AND OUTSIDE DIRECTOR STOCK OPTION PLAN."

(2) All current executive officers as a group.

(3) All current directors who are not officers as a group.

(4) All employees, including all current officers who are not executive
officers, as a group.

APPROVAL OF 1997 EMPLOYEE STOCK PURCHASE PLAN
(ITEM 4 ON PROXY CARD)

INTRODUCTION

On February 5, 1997, the Board of Directors approved the 1997 Employee Stock
Purchase Plan (the "Stock Plan"). The Stock Plan provides the employees of the
Company with the opportunity to purchase the Company's Common Stock through
offerings to be made during a five-year period. The approval of the Company's
stockholders is desirable in order to comply with certain ongoing listing
requirements of the New York Stock Exchange and to qualify for certain
exemptions under Section 162(m) of the Code. The Board of Directors hereby
recommends the approval by the Company's stockholders of the Stock Plan.

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<PAGE>
The Stock Plan is effective and the five-year period will commence on June
1, 1997, subject to approval by the Company's stockholders at the annual
meeting. The opportunity to purchase the Company's Common Stock under the Stock
Plan will cease on June 1, 2002.

MATERIAL FEATURES OF THE STOCK PLAN

The following discussion summarizes the material features of the Stock Plan.
The full text of the Stock Plan appears as Exhibit II to this Proxy Statement
and reference is made to such exhibit for a full statement of the terms and
conditions of the Stock Plan.

ADMINISTRATION

The Stock Plan is to be administered by a committee consisting of three or
more members appointed by the Board of Directors either from members of senior
management, from the Board of Directors, or a combination thereof (the
"Committee"). The Committee shall have the authority to interpret the Stock Plan
and make rules and regulations for the administration of the Stock Plan.

PURCHASE OF SHARES

The Stock Plan provides for offerings of shares of the Company's Common
Stock on a routine basis. Each offering period shall last three (3) months, with
the first offering period to commence June 1, 1997. Three hundred thousand
(300,000) shares of the Company's Common Stock have been reserved for such
purpose.

Each employee choosing to participate in the offering shall receive an
option, upon the effective date of such offering, for as many full shares of the
Company's Common Stock as the participant chooses to purchase with up to 15% of
the compensation received by such employee during the specified offering period,
to be paid by payroll deductions.

The purchase price for each share of the Company's Common Stock purchased
under the Stock Plan shall be 85% of the lower of (i) the fair market value of
the Common Stock at the beginning of the offering period, or (ii) the fair
market value of the Common Stock at the end of the offering period. As of the
last day of the offering period, the participant shall be deemed to have
exercised the option and shall be charged for the amount of the purchase.

Since participation and the degree of participation in the Stock Plan are
purely discretionary on the part of eligible employees, future benefits under
the Stock Plan are not currently determinable.

ELIGIBLE EMPLOYEES

Any employee of the Company or its subsidiaries is eligible to participate
in the Stock Plan if he or she has been employed by the Company or its
subsidiaries for the twelve months preceding the offering, during which time he
or she has completed at least 1,000 hours. No employee may participate in the
Stock Plan if such employee, immediately after the commencement of the offering,
owns 5% or more of the total combined voting power or value of the stock of the
Company or any subsidiary. No employee whose customary employment with the
company is for less than five (5) months per year or less than twenty (20) hours
per week may participate.

NON-ASSIGNABILITY

No right granted pursuant to the Stock Plan shall be transferable other than
by will or the laws of descent and distribution. In the event of a participating
employee's retirement, death or other termination of employment, such employee
shall be ineligible to continue to participate in the Stock Plan.

25
<PAGE>
AMENDMENTS AND TERMINATION

The Board of Directors may at any time, or from time to time, amend the
Stock Plan in any respect, except that, without the approval of the holders of a
majority of the shares of stock of the Company then issued and outstanding and
entitled to vote, no amendment shall be made (i) increasing the number of shares
approved for the Stock Plan, (ii) decreasing the purchase price per share, or
(iii) withdrawing the administration of the Plan from the Committee.

The Stock Plan and all rights of employees under any offering thereunder
shall terminate: (i) on the day that participating employees become entitled to
purchase a number of shares equal to or greater than the number of shares
remaining available for purchase. If the number of shares so purchasable is
greater than the shares remaining available, the available shares shall be
allocated by the Committee among such participating employees in such manner as
it deems fair; or (ii) at any time, at the discretion of the Board of Directors.

FEDERAL INCOME TAX CONSEQUENCES

The Company has been advised by its counsel that the federal income tax
consequences of the Stock Plan are as described below. The following is not a
definitive explanation of the tax consequences of the Stock Plan. Employees
should consult with their own tax advisors with respect to the tax consequences
inherent in the ownership of the Company's Common Stock.

For federal income tax purposes, an employee does not realize income at the
time of entry into the Stock Plan or purchase of a share of the Company's Common
Stock. If no disposition of the Common Stock is made within two years from the
date the share is transferred to the employee, upon subsequent disposition of
the stock, ordinary income will be realized to the extent of the lesser of (1)
15% of the average market value on the offering date, or (2) the amount by which
the net proceeds of the sale exceed the price paid. Any further gain is treated
as capital gain. No income tax deduction will be allowed the Company for shares
transferred to an employee, provided such shares are held for the periods
described above. If the shares are disposed of within the periods described
above, the employee will recognize ordinary income for the taxable year of the
disposition equal to the excess of the fair market value of the shares on the
date of purchase over the price paid. Generally, the Company will be entitled to
a deduction equal to the amount of ordinary income recognized by the employee.

RECOMMENDATION OF THE BOARD OF DIRECTORS "FOR" THIS PROPOSAL

The Board of Directors believes that the Stock Plan will promote the
interests of the Company and its stockholders by providing Company employees an
opportunity to purchase the Company's Common Stock. The Stock Plan is designed
to align the interests of Company employees with those of the current
stockholders, through permitting and encouraging stock ownership by Company
employees and executives. As such, the Board of Directors believes that the
Stock Plan will contribute to and promote the stability of the Company.
Accordingly, THE BOARD OF DIRECTORS RECOMMENDS APPROVAL OF THE STOCK PLAN AND
PROXIES SOLICITED BY THE BOARD WILL BE SO VOTED IN THE ABSENCE OF INSTRUCTIONS
TO THE CONTRARY.

OTHER INFORMATION

Information as to certain benefit plans currently in effect or proposed for
directors, officers and employees of the Company is set forth in the sections of
this proxy statement entitled, "DIRECTORS' COMPENSATION, COMMITTEES AND
MEETINGS," "EXECUTIVE COMPENSATION," "APPROVAL OF THE 1997 LONG-TERM EXECUTIVE
COMPENSATION AND OUTSIDE DIRECTOR STOCK OPTION PLAN" and "APPROVAL OF INCENTIVE
PLAN FOR 162(m) EXECUTIVES."

26
<PAGE>
APPROVAL OF INCENTIVE PLAN FOR 162(M) EXECUTIVES
(ITEM 5 ON PROXY CARD)

INTRODUCTION

On February 17, 1997, the Board of Directors approved the Incentive Plan for
162(m) Executives (the "162(m) Incentive Plan"). The 162(m) Incentive Plan
provides for the grant of cash awards to "covered employees" as defined in
Section 162(m)(3) of the Code. The 162(m) Incentive Plan will become effective
upon approval by the stockholders of the Company. The approval of the Company's
stockholders is being sought in order to qualify the 162(m) Incentive Plan for
certain federal tax deductions under Section 162(m) of the Code. Section 162(m)
of the Code disallows a federal tax deduction to publicly-traded corporations
for compensation to certain executive officers in excess of $1 million per year
unless the material terms of such performance-based compensation have been
approved by the corporation's stockholders. The Board of Directors hereby
recommends the approval by the Company's stockholders of the 162(m) Incentive
Plan. The Board of Directors does not intend for the 162(m) Incentive Plan to
create new benefits not currently available to the eligible participants.

MATERIAL FEATURES OF THE PLAN

The following discussion summarizes the material features of the 162(m)
Incentive Plan. The full text of the 162(m) Incentive Plan appears as Exhibit
III to this Proxy Statement and reference is made to such exhibit for a full
statement of the terms and conditions of the 162(m) Incentive Plan.

ADMINISTRATION

The 162(m) Incentive Plan is to be administered by the Compensation
Committee of the Board of Directors of the Company or such other committee to
which the Board has delegated administrative authority over the 162(m) Incentive
Plan (the "Committee"). The Committee consists of three or more members of the
Board of Directors who are not employees of the Company. The Committee is
authorized to interpret the 162(m) Incentive Plan and to prescribe, amend, and
rescind rules relating to the 162(m) Incentive Plan. The Committee shall
establish the target awards for eligible employees and may, in its discretion,
cancel or decrease an earned target award. The Committee may not, except as
otherwise permitted under Treasury Regulation Section 1.162-27(e)(2)(iii)(C),
increase such earned target award. The Committee may delegate certain of these
activities, and all other matters as it solely determines.

TYPES OF AWARDS

Awards under the 162(m) Incentive Plan shall be cash distributions based on
the attainment of specific performance goals. Such performance goals shall be
established by the Committee, in writing, within the first 90 days of the
Company's fiscal year. Such performance goals will be based on one or more of
the following performance-based criteria: earnings per share of Company stock,
return on net assets, return on assets, return on equity, return on capital,
return on revenues, cash flow, book value, Company stock price performance, or
price-earning ratio. In addition, the Committee may nevertheless decline to pay
all or part of an award if the participant does not attain individual objectives
as established by the Committee regardless of whether the performance goals have
been fully achieved. Notwithstanding the foregoing, the maximum target award
payable to any participant in any year is 200% of his or her annual salary.

Since the eligibility for awards and the amount of any award under the
162(m) Incentive Plan is determined by the performance goals as set by the
Committee and the future attainment of such goals, future benefits under the
162(m) Incentive Plan are not currently determinable.

ELIGIBLE EMPLOYEES

The Committee shall identify in writing, within the first 90 days of each
fiscal year, the employees who will participate in the 162(m) Incentive Plan. An
employee is eligible to participate in the 162(m) Incentive

27
<PAGE>
Plan if the Committee has determined that the employee is a "covered employee"
(as defined in Section 162(m)(3) of the Code) for the current fiscal year.
Approximately five (5) employees of the Company will be eligible to participate
in the 162(m) Incentive Plan each year.

NON-ASSIGNABILITY

No right granted pursuant to the 162(m) Incentive Plan shall be transferable
or assignable by its recipient other than by will or the laws of descent and
distribution.

AMENDMENTS AND TERMINATION

The Board of Directors may, in its sole and absolute discretion, amend,
suspend or terminate the 162(m) Incentive Plan at any time, with or without
notice to the participants in the 162(m) Incentive Plan. No amendment to the
162(m) Incentive Plan shall be effective which would increase the maximum award
payable to an individual participant, change the specified performance
objectives for payment of awards, or which would modify the eligibility
requirements unless the stockholders of the Company have first approved such
change. Under no circumstances shall the 162(m) Incentive Plan be amended to
permit the Committee to increase an earned target award.

FEDERAL INCOME TAX CONSEQUENCES

The Company has been advised by its counsel that the federal income tax
consequences of the 162(m) Incentive Plan are as described below. The following
is not a definitive explanation of the tax consequences of the awards under the
162(m) Incentive Plan. Participants should consult with their own tax advisors
with respect to the tax consequences of their individual awards.

A participant in the 162(m) Incentive Plan recognizes ordinary income at the
time of the award under the plan equal to the value of the award. The Company
will be entitled to a deduction equal to the amount of ordinary income
recognized by the employee.

RECOMMENDATION OF THE BOARD OF DIRECTORS "FOR" THIS PROPOSAL

The Board of Directors believes that the 162(m) Incentive Plan will promote
the interests of the Company and its stockholders and enable the Company and its
subsidiary corporations to continue to provide incentives and financial rewards
to selected employees of the Company for their contribution to improving the
profitability of the Company. The 162(m) Incentive Plan does not create any new
benefits for the "covered employees." The purpose of the new plan is merely to
preserve an income tax deduction for all payments under existing bonus plans,
thereby eliminating the adverse impact on per share earnings which would result
from a failure to qualify for such tax deduction. As such, the Board of
Directors believes that the 162(m) Incentive Plan is in the best interests of
the Company and its stockholders. Accordingly, THE BOARD OF DIRECTORS RECOMMENDS
APPROVAL OF THE 162(m) INCENTIVE PLAN AND PROXIES SOLICITED BY THE BOARD WILL BE
SO VOTED IN THE ABSENCE OF INSTRUCTIONS TO THE CONTRARY.

OTHER INFORMATION

Information as to certain benefit plans currently in effect or proposed for
directors, officers and employees of the Company is set forth in the sections of
this Proxy Statement entitled "DIRECTORS' COMPENSATION, COMMITTEES AND
MEETINGS," "EXECUTIVE COMPENSATION," "APPROVAL OF THE 1997 LONG-TERM EXECUTIVE
COMPENSATION AND OUTSIDE DIRECTOR STOCK OPTION PLAN" and "APPROVAL OF 1997
EMPLOYEE STOCK PURCHASE PLAN."

COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934

Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
directors and executive officers and persons who own beneficially more than ten
percent of the Company's Common Stock to file with the Commission initial
reports of beneficial ownership and reports of changes in beneficial ownership

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of the Common Stock. Officers, directors and persons owning more than ten
percent of the Common Stock are required to furnish the Company with copies of
all such reports. Directors Grossman, Morrison and Toppel filed Forms 4 on July
8, 1996 with respect to stock option grants to them on April 30, 1996 (Forms 4
due May 10, 1996). Directors Evans, Hallman and Victory filed Forms 4 on July 9,
1996 with respect to stock option grants to them on April 30, 1996 (Forms 4 due
May 10, 1996). Each of the above late filings was a result of oversights by the
Company's legal department, which had undertaken to prepare and file the
respective forms for the persons described above. Except as stated above, to the
Company's knowledge, based on a review of copies of such reports furnished to
the Company and written representations from its officers and directors that no
other reports were required, during the fiscal year ended December 27, 1996, all
other Section 16(a) filing requirements applicable to its executive officers,
directors and persons owning beneficially more than ten percent of the Common
Stock were complied with on a timely basis.

STOCKHOLDER PROPOSALS

Recommendations to the Nominating Committee for nominees to be elected to
the Board of Directors and proposals of stockholders intended to be presented at
the next Annual Meeting scheduled to be held in May or June, 1998, must be
submitted in writing to the Secretary of Interim Services Inc., 2050 Spectrum
Boulevard, Fort Lauderdale, Florida 33309. Stockholder recommendations and
proposals must be received by the Secretary no later than December 31, 1997, in
order to be included in next year's Proxy Statement and Proxy Card.

OTHER MATTERS

The Board of Directors knows of no other matters which will be presented at
the meeting, but if other matters do properly come before the meeting it is
intended that the persons named in the proxy will vote according to their best
judgment.

The Annual Report To Stockholders of the Company for the twelve months ended
December 27, 1996 (the "Annual Report"), is being mailed concurrently with this
Proxy Statement to all stockholders of record as of April 3, 1997, except for
accounts where the stockholder had filed a written request to eliminate
duplicate reports. The Company's audited financial statements, management's
discussion and analysis of financial condition and results of operations,
selected five-year financial data, and quarterly data are contained in Appendix
A enclosed herewith. In addition, the Company has provided brokers, dealers,
banks, voting trustees and their nominees, at Company expense, with additional
copies of the Annual Report so that such record holders could supply such
material to beneficial owners as of April 3, 1997. ADDITIONAL COPIES OF THE
ANNUAL REPORT AND THE ANNUAL REPORT ON FORM 10-K FOR THE TWELVE MONTHS ENDED
DECEMBER 27, 1996, FILED WITH THE COMMISSION (the "Form 10-K"), BUT WITHOUT
EXHIBITS TO THE FORM 10-K, WILL BE AVAILABLE WITHOUT CHARGE, UPON REQUEST TO:

Roy G. Krause
Executive Vice President and
Chief Financial Officer
Interim Services Inc.
2050 Spectrum Boulevard
Fort Lauderdale, Florida 33309

By Order of the Board of Directors
John B. Smith, SECRETARY

April 10, 1997

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EXHIBIT I

INTERIM SERVICES INC.
1997 LONG-TERM EXECUTIVE COMPENSATION
AND OUTSIDE DIRECTOR STOCK OPTION PLAN

1. PURPOSES. The purposes of this 1997 Long-Term Executive Compensation
and Outside Director Stock Option Plan are to provide incentives and rewards to
those employees largely responsible for the success and growth of Interim
Services Inc., its subsidiary corporations and to assist all such corporations
in attracting and retaining executives and other key employees with experience
and ability, to attract and retain experienced and qualified directors who are
not employees of the Company or any Subsidiary, and to secure for the Company
and its stockholders the benefits of stock ownership in the Company by those
executives, key employees, and directors. This Plan is the result of the merger
of the Interim Services Inc. 1993 Long-Term Executive Compensation Plan and the
Interim Services Inc. 1993 Stock Option Plan for Outside Directors.

2. DEFINITIONS.

(a) "Award" means one or more of the following: shares of Common Stock,
Restricted Shares, Stock Options, Stock Appreciation Rights, Performance
Shares, Performance Units and any other rights which may be granted to a
Recipient under the Plan (but shall not mean a Stock Option grant pursuant
to Section 12).

(b) "Common Stock" means the Common Stock, $0.01 par value, of the
Company.

(d) "Director" means a member of the Board of Directors of the Company
or a member of the Board of Directors of any Subsidiary.

(e) "Incentive Stock Option" means a Stock Option which meets all of the
requirements of an "incentive stock option" as defined in Section 422(b) of
the Internal Revenue Code of 1986, as now in effect or hereafter amended
(the "Internal Revenue Code").

(f) "Outside Director" means a Director who is not an employee of the
Company or a Subsidiary on the date of grant of a Stock Option.

(g) "Performance Period" means that period of time specified by the
Committee during which a Recipient must satisfy any designated performance
goals in order to receive an Award.

(h) "Performance Share" means the right to receive, upon satisfying
designated performance goals for a Performance Period, shares of Common
Stock, cash, or a combination of cash and shares of Common Stock, based on
the market value of shares of Common Stock covered by such Performance
Shares at the close of the Performance Period.

(i) "Performance Unit" means the right to receive, upon satisfying
designated performance goals within a Performance Period, shares of Common
Stock, cash, or a combination of cash and shares of Common Stock.

(j) "Plan" means this 1997 Long-Term Executive Compensation and Outside
Director Stock Option Plan, as the same may be amended from time to time.

(k) "Recipient" means an employee of the Company or a Subsidiary who has
been granted an Award under the Plan.

(l) "Restricted Share" means a share of Common Stock issued to a
Recipient hereunder subject to such terms and conditions, including, without
limitation, forfeiture or resale to the Company, and to such restrictions
against sale, transfer or other disposition, as the Committee may determine
at the time of issuance.

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(m) "Stock Appreciation Right" means the right to receive, upon exercise
of a Stock Appreciation Right granted under this Plan, shares of Common
Stock, cash, or a combination of cash and shares of Common Stock, based on
the increase in market value of the shares of Common Stock covered by such
Stock Appreciation Right from the initial day of a Performance Period for
such Stock Appreciation Right to the date of exercise.

(n) "Stock Option" means the right to purchase, upon exercise of a Stock
Option granted under this Plan, including Stock Options granted pursuant to
Section 12, shares of the Company's Common Stock.

(o) "Subsidiary" means a subsidiary of the Company, its divisions,
departments, and subsidiaries and the respective divisions, departments and
subsidiaries of such subsidiaries.

3. ADMINISTRATION OF THE PLAN. The Plan shall be administered by a
Compensation Committee (the "Committee") consisting of Outside Directors of the
Company to be appointed by and to serve at the pleasure of the Board of
Directors of the Company. A majority of the Committee members shall constitute a
quorum and the acts of a majority of the members present at any meeting at which
a quorum is present, or acts approved in writing by a majority of the Committee,
shall be valid acts of the Committee. All references herein to the Committee
shall be deemed to mean any successor to the Committee, however designated, or
the Board of Directors of the Company if the Board has not appointed a
Committee.

The Committee shall have full power and authority to construe, interpret and
administer the Plan and, subject to the powers herein specifically reserved to
the Board of Directors and subject to the other provisions of this Plan, to make
determinations which shall be final, conclusive and binding upon all persons
including, without limitation, the Company, the stockholders of the Company, the
Board of Directors, the Recipients and any persons having any interest in any
Awards which may be granted under the Plan. The Committee shall impose such
additional conditions upon the grant and exercise of Awards under this Plan as
may from time to time be deemed necessary or advisable, in the opinion of
counsel to the Company, to comply with applicable laws and regulations. The
Committee from time to time may adopt rules and regulations for carrying out the
Plan and written policies for implementation of the Plan. Such policies may
include, but need not be limited to, the type, size and terms of Awards to be
made to Recipients and the conditions for payment of such Awards.

4. ABSOLUTE DISCRETION. The Committee may, in its sole discretion, at any
time and from time to time during the continuance of the Plan, (i) determine
which employees of the Company shall be granted Awards under the Plan, (ii)
grant to any employee so selected such an Award, (iii) determine the type, size
and terms of Awards to be granted (subject to Sections 6, 10 and 11 hereof, as
hereafter amended), (iv) establish objectives and conditions for receipt of
Awards, (v) place conditions or restrictions on the payment or exercise of
Awards, and (vi) do all other things necessary and proper to carry out the
intentions of this Plan; provided, however, that, in each and every case, those
Awards which are Incentive Stock Options shall contain and be subject to those
requirements specified in Section 422 of the Internal Revenue Code.

5. ELIGIBILITY. Awards may be granted to any employee of the Company. No
member of the Committee (other than an ex officio member) shall be eligible for
grants of Awards under the Plan, although such member may be eligible for grants
of Stock Options under Section 12. An employee may be granted multiple forms of
Awards under the Plan. Subject to Section 6 relating to the total number of
shares of Common Stock issuable under this Plan, Incentive Stock Options may be
granted under this Plan to a Recipient for any number of shares of Common Stock,
subject to the limitation that the aggregate fair market value of such shares of
Common Stock (determined as of time the Incentive Stock Option is granted) with
respect to which Incentive Stock Options are exercisable for the first time by
such Recipient during any calendar year under the Plan and any other "incentive
stock option plans" (as defined in the Internal Revenue Code) maintained by the
Company shall not exceed $100,000.

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6. STOCK SUBJECT TO THE PLAN. The total number of shares of Common Stock
issuable under this Plan may not exceed an aggregate 2,400,000 shares, subject
to adjustment as provided herein. All of such shares may be issued or issuable
under this Plan in connection with the exercise of Incentive Stock Options.
Shares of Common Stock not actually issued pursuant to an Award and/or a Stock
Option shall be available for future Awards and/or Stock Options. Shares of
Common Stock to be delivered or purchased under the Plan may be either
authorized but unissued Common Stock or treasury shares. The maximum number of
shares of Common Stock with respect to which Stock Options may be granted to any
Recipient during any calendar year is 100,000 shares.

7. AWARDS.

(a) Awards under the Plan may include, but need not be limited to,
shares of Common Stock, Restricted Shares, Stock Options, Incentive Stock
Options, Stock Appreciation Rights, Performance Shares and Performance
Units. The amount of each Award may be based upon the market value of a
share of Common Stock. The Committee may make any other type of Award which
it shall determine is consistent with the objectives and limitations of the
Plan.

(b) The Committee may establish performance goals to be achieved within
such Performance Periods as may be selected by it using such measures of the
performance of the Company it may select as a condition to the receipt of
the Award.

8. VESTING REQUIREMENTS. The Committee may determine that all or a portion
of an Award or a payment to a Recipient pursuant to an Award, in any form
whatsoever, shall be vested at such times and upon such terms as may be selected
by it.

9. DEFERRED PAYMENTS AND DIVIDEND AND INTEREST EQUIVALENTS.

(a) The Committee may determine that the receipt of all or a portion of
an Award or a payment to a Recipient pursuant to an Award, in any form
whatsoever, shall be deferred. Deferrals shall be for such periods and upon
such terms as the Committee may determine.

(b) The Committee may provide, in its sole and absolute discretion, that
a Recipient to whom an Award is payable in whole or in part at a future time
in shares of Common Stock shall be entitled to receive an amount per share
equal in value to the cash dividends paid per share on issued and
outstanding shares as of the dividend record dates occurring during the
period from the date of the Award to the date of delivery of such share to
the Recipient. The Committee may also authorize, in its sole and absolute
discretion, payment of an amount which a Recipient would have received in
interest on (i) any Award payable at a future time in cash during the period
from the date of the Award to the date of payment, and (ii) any cash
dividends paid on issued and outstanding shares as of the dividend record
dates occurring during the period from the date of an Award to the date of
delivery of shares pursuant to the Award. Any amounts provided under this
subsection shall be payable in such manner, at such times, and subject to
such terms and conditions as the Committee may determine in its sole and
absolute discretion.

10. CONTINUATION OF EMPLOYMENT. The Committee shall require that a
Recipient be an employee of the Company at the time an Award is made and vested.
The Committee may provide for the termination of an outstanding Award if a
Recipient ceases to be an employee of the Company and may establish such other
provisions with respect to the termination or disposition of an Award on the
death or retirement of a Recipient as it, in its sole discretion, deems
advisable. The Committee shall have the sole power to determine the date of and
the circumstances which shall constitute a cessation of employment and to
determine whether such cessation is the result of retirement, death or any other
reason.

11. EMPLOYMENT STATUS. No Award shall be construed as imposing upon the
Company the obligation to continue the employment of a Recipient. No employee or
other person shall have any claim or right to be granted an Award under the
Plan.

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12. STOCK OPTION GRANTS TO OUTSIDE DIRECTORS. Stock Options may be granted
under the Plan to Outside Directors, subject to the provisions of this Section
12. As of April 30 of each year, each Outside Director serving on the Company's
Board of Directors shall be granted a Stock Option to purchase 2,000 shares of
Common Stock. The Committee may determine all or a portion of a Stock Option
granted pursuant to this Section 12 shall vest at the times and upon such terms
as selected by it. The Committee may grant Stock Options to purchase shares of
Common Stock to Outside Directors who are not members of the Company's Board of
Directors at such times as the Committee, in its sole discretion, may determine.
The Committee may require that all Stock Options granted under this Section 12
be exercised prior to an Outside Director's termination of service as a
Director.

13. STOCK OPTION PRICE. The purchase price per share of Common Stock under
each Stock Option (including Stock Options granted under Section 12) shall be
equal to the closing price for the Common Stock on the New York Stock Exchange
(or on the principal securities exchange or other market on which the Common
Stock is then being traded) on the date the Stock Option or Incentive Stock
Option is granted or if such closing price is not reported on the date of grant,
the last reported closing price. Payment for exercise of any Stock Option
granted hereunder shall be made (a) in cash, or (b) by delivery of Common Stock
having a market value equal to the aggregate option price, or (c) by a
combination of payment of cash and delivery of Common Stock in amounts such that
the amount of cash plus the market value of the Common Stock equals the
aggregate option price.

14. STOCK APPRECIATION RIGHT VALUE. The base value per share of Common
Stock covered by an Award in the form of a Stock Appreciation Right shall be the
market value of one share of Common Stock on the date the Award is granted.

15. REGISTRATION OF STOCK. Each Award and each Stock Option granted under
Section 12 shall be subject to the requirement that if at any time the Committee
(or, in the case of a Stock Option granted under Section 12, counsel for the
Company) shall determine that qualification or registration under any state or
federal law of the shares of Common Stock, Restricted Shares, Stock Options,
Incentive Stock Options, or other securities thereby covered or the consent or
approval of any governmental regulatory body is necessary or desirable as a
condition of or in connection with the granting of such Award or Stock Option or
the purchase of shares thereunder, the Award or Stock Option may not be paid or
exercised in whole or in part unless and until such qualification, registration,
consent or approval shall have been effected or obtained free of any conditions
the Committee, in its discretion, deems unacceptable.

16. ASSIGNABILITY. No Award or Stock Option granted pursuant to the Plan
shall be transferable or assignable by the Recipient other than by will or the
laws of descent and distribution (subject to such restrictions as may be imposed
pursuant to Section 12) and during the lifetime of the Recipient shall be
exercisable or payable only by or to him or her.

17. DILUTION OR OTHER ADJUSTMENTS. In the event of any changes in the
capital structure of the Company, including but not limited to a change
resulting from a stock dividend or split-up, or combination or reclassification
of shares, the Board of Directors shall make such equitable adjustments with
respect to Awards and Stock Options granted pursuant to Section 12 or any other
provisions of this Plan as it deems necessary and appropriate, including, if
necessary, any adjustment in the maximum number of shares of Common Stock
subject to the Plan or the number of shares of Common Stock subject to an
outstanding Award or Stock Option granted pursuant to Section 12.

18. MERGER, CONSOLIDATION, REORGANIZATION, LIQUIDATION, ETC. If the
Company shall become a party to any corporate merger, consolidation, major
acquisition of property for stock, reorganization, or liquidation, the Board of
Directors may make such arrangements it deems advisable with respect to
outstanding Awards or Stock Options, which shall be binding upon Recipients of
outstanding Awards and all optionees of Stock Options granted pursuant to
Section 12, including, but not limited to, the substitution of any new Awards or
Stock Options then outstanding, the assumption of any such Awards or Stock
Options and the termination of or payment for such Awards or Stock Options.

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19. WITHHOLDING TAXES. The Company shall have the right to deduct from all
Awards paid hereunder in cash any federal, state, local or foreign taxes
required by law to be withheld with respect to such Awards and, with respect to
Awards paid in other than cash, to require the payment (through withholding from
the Recipient's salary or otherwise) of any such taxes. Subject to such
conditions as the Committee may establish, Awards under the Plan payable in
shares of Common Stock may provide that the Recipients thereof may elect, in
accordance with any applicable regulations, to have the Company withhold shares
of Common Stock to satisfy all or part of any such withholding obligations, with
the value of such withheld shares of Common Stock based upon their fair market
value on the date the tax withholding is required to be made.

20. COSTS AND EXPENSES. The costs and expenses of administering the Plan
shall be borne by the Company and not charged to any Award nor to any Recipient.

21. FUNDING OF PLAN. The Plan shall be unfunded. The Company shall not be
required to establish any special or separate fund or to make any other
segregation of assets to assure the payment of any Award under the Plan.

22. AWARD CONTRACTS AND STOCK OPTION AGREEMENTS. The Committee shall have
the power to specify the form of Award contracts and Stock Option agreements to
be granted from time to time pursuant to and in accordance with the provisions
of the Plan and such contracts and agreements shall be final, conclusive and
binding upon the Company, the stockholders of the Company and the Recipients and
optionees of Stock Options granted pursuant to Section 12. No Recipient or
optionee of a Stock Option granted pursuant to Section 12 shall have any rights
as a holder of Common Stock with respect to Awards or Stock Options hereunder
unless and until certificates for shares of Common Stock or Restricted Shares
are issued to the Recipient or to the optionee of a Stock Option granted
pursuant to Section 12.

23. GUIDELINES. The Board of Directors of the Company shall have the power
to provide guidelines for administration of the Plan by the Committee and to
make any changes in such guidelines from time to time as the Board deems
necessary.

24. AMENDMENT AND DISCONTINUANCE. The Board of Directors of the Company
shall have the right at any time during the continuance of the Plan to amend,
modify, supplement, suspend or terminate the Plan, provided that in the absence
of the approval of the holders of a majority of the shares of Common Stock of
the Company present in person or by proxy at a duly constituted meeting of the
stockholders of the Company, no such amendment, modification or supplement shall
(i) increase the aggregate number of shares which may be issued under the Plan,
unless such increase is by reason of any change in capital structure referred to
in Section 17 hereof, (ii) change the termination date of the Plan provided in
Section 25, or (iii) delete or amend the market value restrictions contained in
Sections 13 and 14 hereof, and provided further, that no amendment, modification
or termination of the Plan shall in any manner affect any Award or Stock Option
granted pursuant to Section 12 of any kind theretofore granted under the Plan
without the consent of the Recipient of the Award or the optionee of a Stock
Option, as the case may be, unless such amendment, modification or termination
is by reason of any change in capital structure referred to in Section 17 hereof
or unless the same is by reason of the matters referred to in Section 18 hereof.

25. TERMINATION. The Committee may grant Awards and Stock Options at any
time prior to February 5, 2007, on which date this Plan will terminate except as
to Awards and Stock Options then outstanding hereunder, which Awards and Stock
Options shall remain in effect until they have expired according to their terms
or until February 5, 2017, whichever first occurs. No Incentive Stock Option
shall be exercisable later than 10 years following the date it is granted.

26. APPROVAL. This Plan was adopted by the Board of Directors on February
5, 1997 subject to the approval of the stockholders of the Company. The Plan
shall take effect upon due approval of the stockholders of the Company.

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EXHIBIT II

INTERIM SERVICES INC.
1997
EMPLOYEE STOCK PURCHASE PLAN

The purpose of this Plan is to provide employees a continued opportunity to
purchase stock of Interim Services through annual offerings to be made during
the five-year period commencing June 1, 1997. Three hundred thousand (300,000)
shares of Interim Services stock in the aggregate have been approved for this
purpose.

1. ADMINISTRATION. The Plan shall be administered by a Committee
consisting of at least three members appointed by the Board of Directors either
from members of senior management, from the Board of Directors, or a combination
thereof. The Committee shall have authority to make rules and regulations for
the administration of the Plan; its interpretations and decisions with regard
thereto shall be final and conclusive.

2. ELIGIBILITY. Except as provided below, any employee of Interim Services
or its subsidiaries shall be eligible to participate in the Stock Plan if he or
she has been employed by the Company or its subsidiaries for the twelve months
preceding the offering, during which time he or she has completed at least 1,000
hours. Participation shall be in accordance with such rules as may be prescribed
by the Committee from time to time, which rules, however, shall neither permit
nor deny participation in the Plan contrary to the requirements of Section 423
of the Internal Revenue Code and the regulations promulgated thereunder. No
employee may participate in an offering if such employee, immediately after the
commencement of such offering, owns 5% or more of the total combined voting
power or value of the stock of Interim Services or any subsidiary. For purposes
of the preceding sentence, the rules of Section 424(d) of the Internal Revenue
Code shall apply in determining the stock ownership of an employee, and stock
that the employee may purchase under outstanding options shall be treated as
stock owned by the employee. No employee whose customary employment is for less
than five (5) months per year or less than twenty (20) hours per week may
participate.

3. OFFERINGS. Interim Services shall make one or more annual offerings to
participating employees to purchase Interim Services stock under the Plan. Each
offering period shall be 3 months in duration with the first offering period to
commence June 1, 1997. During an offering the amounts received as compensation
by a participating employee shall constitute the measure of such employee's
participation in the offering as is based on compensation.

4. PARTICIPATION. An employee eligible on the effective date of any
offering may participate in such offering at any time by completing and
forwarding a payroll deduction authorization to the employee's appropriate
payroll location. The form will authorize a regular payroll deduction from such
employee's compensation, and must specify the date on which such deduction is to
commence, which may not be earlier than the first day of the next pay period
after the form is received by the Company. All participating employees shall
have the same rights and privileges under the Plan except that the amount of
stock a participating employee may purchase shall bear a uniform relationship to
compensation pursuant to Section 5.

5. DEDUCTIONS. Interim Services shall maintain payroll deduction accounts
for all participating employees. With respect to any offering made under the
Plan, a participating employee may authorize a payroll deduction of whole
percentages (up to a maximum of 15%) of the compensation such employee receives
during the offering period (or during such portion thereof in which the employee
may elect to participate). The Committee may require a minimum payroll deduction
for participation in any offering consistent with the requirements of Section
423 of the Internal Revenue Code.

No employee may be granted an option that permits his or her rights to
purchase stock under the Plan, and all other employee stock purchase plans of
Interim Services and its subsidiaries described in Section 423 of the Internal
Revenue Code, to accrue at a rate that exceeds $25,000 of the fair market value

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of such stock (determined at the effective date of the applicable offering) for
each calendar year in which the option is outstanding at any time. In the event
that a participating employee's payroll deductions would otherwise result in the
purchase of stock in excess of the foregoing limitations, the stock purchase
shall cease when the limitations are reached and the excess cash shall be
refunded to such participating employee.

6. DEDUCTION CHANGES. A participating employee may increase or decrease
such employee's payroll deduction by filing a new payroll deduction
authorization at any time during an offering period. The change may not become
effective sooner than the next pay period after receipt of the authorization. If
a participating employee ceases his or her payroll deductions, the Committee
may, in its discretion, either declare his or her participation to have
terminated and authorize distribution pursuant to Section 11 or permit the
employee to have his or her cash remain credited under the Plan and apply such
cash to the purchase of stock at the end of the offering period in which such
cessation occurs.

7. PURCHASE OF SHARES. Each employee participating in any offering under
the Plan shall be granted an option, upon the effective date of such offering,
for as many full shares of Interim Services stock as the participating employee
may elect to purchase with up to 15% of the compensation received during the
specified offering period (or during such portion thereof as the employee may
elect to participate), to be paid by payroll deductions during such period.

The purchase price for each share purchased shall be 85% of the lower of (i)
the fair market value of Interim Services stock at the beginning of the offering
period, or (ii) the fair market value of Interim Services stock at the end of
the offering period. As of the last day of an offering, the account of each
participating employee shall be totaled, and the employee shall be deemed to
have exercised an option to purchase one or more full shares at the
then-applicable price; the participating employee's account shall be charged for
the amount of the purchase; and the ownership of such share or shares shall be
appropriately evidenced on the books of Interim Services or its agent.

8. EMPLOYEE ACCOUNTS AND CERTIFICATES. Upon purchase of one or more full
shares by a participating employee pursuant to Section 7 hereof, Interim
Services or its agent shall establish a book entry account in the name of the
employee to reflect the share(s) purchased at that time. Certificates shall be
issued only on request, on termination of participation in the Plan, or when
necessary to comply with transaction requirements outside the United States. In
the event a participating employee terminates his or her account, any remaining
cash credited to the account will be paid to such employee.

9. REGISTRATION OF SHARES. Shares may be registered only in the name of
the participating employee, or, if such employee so indicates on the employee's
payroll deduction authorization form, in the participating employee's name
jointly with a member of such employee's family, with right of survivorship. A
participating employee who is a resident of a jurisdiction that does not
recognize such a joint tenancy may have shares registered in such employee's
name as tenant in common or as community property with a member of such
employee's family, without right of survivorship.

10. RIGHTS AS A STOCKHOLDER. None of the rights or privileges of a
stockholder of Interim Services shall exist with respect to shares purchased
under the Plan unless and until such shares shall have been appropriately
evidenced on the books of Interim Services or its agent.

11. RIGHTS ON RETIREMENT, DEATH, TERMINATION OF EMPLOYMENT OR TERMINATION
OF PARTICIPATION. In the event of a participating employee's retirement, death,
or termination of employment, such employee shall be ineligible to continue to
participate in the Plan, and no payroll deduction shall be taken from any pay
due and owing to the employee after the pay period during which the employee
became ineligible. Upon any such termination of participation, or in the event a
participating employee's participation is declared terminated under Section 6,
certificates representing the shares credited to the terminating employee's
account, and any remaining cash credited to such account, shall be transferred
to such employee, or to his or her beneficiary if the employee has died.

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12. RIGHTS NOT TRANSFERABLE. Rights under the Plan are not transferable by
a participating employee other than by will or the laws of descent and
distribution, and are exercisable during the employee's lifetime only by the
employee.

13. APPLICATION OF FUNDS AND ADMINISTRATIVE FEES. All funds received or
held by Interim Services under the Plan may be used for any corporate purpose.
The Committee may impose reasonable administrative fees on participating
employees to defray the administrative costs of the Plan, which shall in no
event exceed the actual administrative costs of the Plan.

14. ADJUSTMENTS IN CASE OF CHANGES AFFECTING INTERIM SERVICES STOCK. In
the event of a subdivision of outstanding shares, or the payment of a stock
dividend, the number of shares approved for the Plan shall be increased
proportionately, and such other adjustments shall be made as may be deemed
equitable by the Board of Directors. In the event of any other change affecting
Interim Services stock, such adjustments shall be made as may be deemed
equitable by the Board of Directors to give proper effect to such event.

15. AMENDMENT OF THE PLAN. The Board of Directors may at any time, or from
time to time, amend the Plan in any respect, except that, without the approval
of the holders of a majority of the shares of stock of Interim Services then
issued and outstanding and entitled to vote, no amendment shall be made (i)
increasing the number of shares approved for the Plan (other than as provided in
Section 14 hereof), (ii) decreasing the purchase price per share, or (iii)
withdrawing the administration of the Plan from a Committee consisting of
persons not eligible to participate in the Plan.

16. TERMINATION OF THE PLAN. The Plan and all rights of employees under
any offering hereunder shall terminate:

a. on the day that participating employees become entitled to purchase
a number of shares equal to or greater than the number of shares remaining
available for purchase. If the number of shares so purchasable is greater
than the shares remaining available, the available shares shall be allocated
by the Committee among such participating employees in such manner as it
deems fair, or

b. at any time, at the discretion of the Board of Directors.

No offering hereunder shall be made which shall extend beyond June 1, 2002.

17. GOVERNMENTAL REGULATIONS. Interim Services' obligation to sell and
deliver Interim Services stock under the Plan is subject to the approval of any
governmental authority required in connection with the authorization, issuance,
or sale of such stock.

18. PLAN SHARES PURCHASES. Purchases of outstanding shares may be made
pursuant to and on behalf of the Plan, upon such terms as Interim Services may
approve, for delivery under the Plan. The shares which may be used under the
Plan include treasury shares, authorized but unissued shares, shares purchased
on the open market, or any combination thereof.

19. PLAN SUBJECT TO STOCKHOLDER APPROVAL. The Plan is adopted subject to
the approval of the stockholders of Interim Services given within 12 months from
the date of adoption. Notwithstanding anything else contained herein, no shares
of Interim Services stock may be purchased under the Plan prior to such
stockholder approval.

20. DEFINITIONS. The term "Interim Services" means Interim Services Inc.,
a Delaware corporation.

The term "Interim Services stock" means the common stock of Interim
Services.

The phrase "fair market value" means the closing price of Interim Services
stock on the New York Stock Exchange on a given day or, if no sales of Interim
Services stock were made on that day, the closing price of Interim Services
stock on the next preceding day on which sales were made on the New York Stock
Exchange. Provided, that the Committee may, in its discretion, establish such
other measure of fair market value as it deems appropriate.

The term "Plan" means this Interim Services Inc. 1997 Employee Stock
Purchase Plan.

The term "subsidiary" means a subsidiary of Interim Services within the
meaning of Section 424(f) of the Internal Revenue Code and the regulations
promulgated thereunder.

II-3
<PAGE>
EXHIBIT III

INTERIM SERVICES INC.
INCENTIVE PLAN
FOR 162(M) EXECUTIVES

I. PLAN PURPOSE

The Interim Services Inc. Incentive Plan For 162(m) Executives is intended
to provide incentives and financial rewards to selected employees of the Company
for their contribution to improving the profitability of the Company.

II. ELIGIBILITY AND PARTICIPATION

Within the first 90 days of each Year, the Committee shall identify, in
writing, the employees who will participate in the Plan for such Year. In order
for an employee to be eligible for participation in the Plan for a particular
Year, the Committee must determine that the employee could be a "covered
employee" of the Company within the meaning of Section 162(m)(3) of the Code for
such Year. Additions to the Plan during a Year shall be made only in the event
of an unusual circumstance, such as a new hire.

III. INDIVIDUAL TARGET AWARDS

Individual target awards shall be established by the Committee for eligible
employees. Target awards will be paid only upon the achievement of specific
performance goals established by the Committee, in writing, within the first 90
days of each Year (or, in the case of a new hire added to the Plan during a
Year, before 25% of such individual's service for the Company for the Year has
elapsed). Such performance goals will be based on one or more of the following
performance-based criteria: earnings per share of Company stock, return on net
assets, return on assets, return on equity, return on capital, return on
revenues, cash flow, book value, Company stock price performance, or
price-earnings ratio. In addition, the Committee may nevertheless decline to pay
all or part of an award if the participant does not attain individual objectives
as established by the Committee regardless of whether the performance goals have
been fully achieved.

IV. DISCRETION TO DECREASE AWARD

The Committee, in its discretion, may cancel or decrease an earned target
award, but, except as otherwise permitted under Treasury Regulation Section
1.162-27(e)(2)(iii)(C), may not under any circumstances, increase such award.

V. MAXIMUM AWARD

Notwithstanding any other provision of this Plan, the maximum target award a
Participant may earn and receive in a Year is 200% of his or her annual salary.
The Committee may, in its discretion, decrease this maximum, but, except as
otherwise permitted under Treasury Regulation Section 1.162-27(e)(27)(iii)(C),
may not, under any circumstances, increase this maximum.

VI. PAYMENTS

Before any payments are made under the Plan, the Committee must certify in
writing that the performance goals justifying the payment of Plan Compensation
have been met. The distribution of Plan Compensation shall be made in cash by
the end of March following the Compensation Year.

III-1
<PAGE>
VII. ENTITLEMENTS

GENERAL RULE. To receive compensation from the Plan, the Participant must
be an employee of the Company at the time of payment of Plan Compensation as
determined by the Committee, in its sole discretion. Exceptions to this rule
shall be made in the cases of death, retirement, layoff, and disability as
described in this Section. The Committee may also, in its sole discretion,
permit other exceptions to this rule.

DEATH, RETIREMENT, LAYOFF AND DISABILITY. If a Participant dies, retires,
is laid off, or becomes disabled during the Compensation Year, the amount earned
shall be prorated and payment made by the end of March following the
Compensation Year. If death, retirement, layoff or disability occurs after the
close of a Compensation Year, but before payment is made, such event shall not
affect calculations.

VIII. ADMINISTRATION

The Committee is authorized and empowered to administer the Plan; interpret
the Plan; prescribe, amend and rescind rules relating to the Plan; and determine
the rights and obligations of Participants under the Plan. The Committee may
delegate certain of these activities, and all other matters as it solely
determines. All decisions of the Committee shall be final and binding upon all
parties including the Company, its stockholders, and its participants.

IX. MISCELLANEOUS

NO CONTRACT OR GUARANTEE OF CONTINUED EMPLOYMENT. Eligibility to
participate in the Plan is not a guarantee of continued employment. The Plan
does not constitute a contract of employment and the Company specifically
reserves the right to terminate a Participant's employment at any time with or
without cause and with or without notice or assigning a reason.

NO GUARANTEE OF PLAN COMPENSATION. Eligibility to participate in this Plan
does not guarantee the payment of Plan Compensation. Participants who have
accrued rights to Plan Compensation shall be general creditors of the Company
and shall not have any interest in the income or assets of the Company.

ASSIGNMENTS AND TRANSFERS. With the exception of transfer by will or by the
laws of descent and distribution, rights under the Plan may not be transferred
or assigned.

WITHHOLDING TAX. The Company will deduct from all cash payments due a
Participant taxes required by law to be withheld with respect to such payments.

X. DEFINITIONS

Except as otherwise specified or as the context may otherwise require, the
following terms have the meanings indicated below for the purposes of this Plan:

BOARD means the Board of Directors of the Company.

CODE means the Internal Revenue Code of 1986, as amended.

COMMITTEE means the Compensation Committee of the Board or any such other
Committee to which the Board has delegated the responsibility for administering
the Plan. The Committee shall consist of three or more members of the Board who
are "outside directors" as defined in Code Section 162(m) and the regulations
thereunder.

COMPANY means Interim Services Inc. and its Subsidiaries.

COMPENSATION YEAR OR YEAR means the fiscal year of the Company.

III-2
<PAGE>
DISABILITY means disability according to the terms of the Company's
long-term disability program as may from time to time be applicable with respect
to the particular Participant.

PARTICIPANT means an eligible Company employee selected for plan
participation in accordance with the procedures set forth in Section II.

PLAN means this Interim Services Inc. Incentive Plan For 162(m) Executives
as set forth herein.

PLAN COMPENSATION means the amounts earned for the year as a consequence of
the Plan.

SUBSIDIARY means any corporation designated by the Committee in which the
Company owns an equity interest.

XI. GOVERNING LAW

The Plan shall be construed, administered and governed in all respects under
and by the applicable internal laws of the State of Florida, without giving
effect to the principles of conflicts of law thereof.

XII. PLAN AMENDMENT AND TERMINATION

The Company may, in its sole and absolute discretion, amend, suspend or
terminate the Plan at any time, with or without advance notice to Participants.
Notwithstanding the foregoing, no amendment to the Plan shall be effective which
would increase the maximum award payable under Section V, which would change the
specified performance objectives for payment of awards under Section III, or
which would modify the requirements as to eligibility for participation under
Section II unless the stockholders of the Company shall have first approved such
change. Under no circumstances may the Plan be amended to permit the Committee
to increase the amount of the target award in contravention of the requirements
of Section IV.

XIII. EFFECTIVE DATE OF THE PLAN

This Plan shall be effective on the date it is approved by the stockholders
of the Company which must occur within one year after approval by the Board. Any
grant of Plan Compensation prior to the approval by the shareholders of the
Company shall be void if such approval is not obtained.

III-3
<PAGE>
APPENDIX A TO PROXY STATEMENT
FINANCIAL INFORMATION
CONTENTS

<TABLE>
<CAPTION>
PAGE
---------

<S> <C>
Selected Financial Data................................................................................... A-2

Management's Discussion and Analysis of Financial Condition and Results of Operations..................... A-3

Independent Auditors' Report.............................................................................. A-9

Consolidated Financial Statements

Consolidated Statements of Earnings..................................................................... A-10

Consolidated Balance Sheets............................................................................. A-11

Consolidated Statements of Stockholders' Equity......................................................... A-12

Consolidated Statements of Cash Flows................................................................... A-13

Notes to Consolidated Financial Statements.............................................................. A-14

Quarterly Financial Data.................................................................................. A-25
</TABLE>

A-1
<PAGE>
SELECTED FINANCIAL DATA

<TABLE>
<CAPTION>
FISCAL YEAR ENDED
-------------------------------------------------------------
1996 1995 1994(1) 1993 1992
----------- ----------- ----------- ----------- ---------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
System-wide Sales (2).............................. $ 1,834,258 $ 1,494,260 $ 1,279,339 $ 1,085,759 $ 973,099
----------- ----------- ----------- ----------- ---------
----------- ----------- ----------- ----------- ---------
INCOME STATEMENT DATA:
Revenues:
Commercial Division
Commercial Staffing.............................. $ 602,504 $ 515,454 $ 431,348 $ 347,189 $ 281,982
Professional Services............................ 308,793 138,140 99,935 79,691 55,785
HealthCare Division................................ 229,002 205,719 165,614 143,209 135,956
Other Income....................................... 6,852 4,934 7,799 4,171 3,740
----------- ----------- ----------- ----------- ---------
Total Revenues................................. 1,147,151 864,247 704,696 574,260 477,463
Expenses:
Cost of Services................................... 795,789 600,169 491,404 402,039 331,782
----------- ----------- ----------- ----------- ---------
Gross Profit..................................... 351,362 264,078 213,292 172,221 145,681
Selling, General & Admin........................... 243,652 177,105 137,859 119,763 106,346
Licensee Commissions............................... 39,500 37,295 33,796 20,586 12,142
----------- ----------- ----------- ----------- ---------
Results of Operations............................ 68,210 49,678 41,637 31,872 27,193
Merger Expense (3)................................. 8,600 -- -- -- --
Amort. Of Intangibles.............................. 8,802 6,884 6,041 5,671 5,285
Interest Expense (4)(5)............................ 5,696 990 112 1,787 1,570
----------- ----------- ----------- ----------- ---------
Earnings Before Taxes............................ 45,112 41,804 35,484 24,414 20,338
Taxes on Earnings.................................. 22,097 18,071 16,028 11,564 9,855
----------- ----------- ----------- ----------- ---------
Net Earnings................................... $ 23,015 $ 23,733 $ 19,456 $ 12,850 $ 10,483
----------- ----------- ----------- ----------- ---------
----------- ----------- ----------- ----------- ---------
Net Earnings Per Share (6)......................... $ 1.38 $ 1.52 $ 1.26 $ 0.93 $ 0.76
----------- ----------- ----------- ----------- ---------
----------- ----------- ----------- ----------- ---------
Net Earnings Per Share (excluding merger
expenses)........................................ $ 1.83
-----------
-----------
Weighted Average Shares............................ 16,709 15,662 15,391 13,873 13,846

BALANCE SHEET DATA:
Total Assets (7)................................... $ 512,490 $ 424,489 $ 275,364 $ 242,925 $ 230,022
Long-term Obligations.............................. -- 60,000 -- 30,000 89,107
Working Capital.................................... 169,283 67,526 81,997 78,898 73,381
OPERATING INFORMATION:
Total Offices (8).................................. 998 940 796 728 674
</TABLE>

- --------------------------

(1) The 1994 fiscal year contained 53 weeks. All other years contained 52 weeks.

(2) Includes sales of all company-owned, franchised and licensed offices. Sales
data for franchised offices are derived from reports provided by
franchisees, which are not audited.

(3) On May 23, 1996, the Company completed a merger with Brandon Systems
Corporation ("Brandon"), an IT staffing company. Merger expense represents
all fees and expenses related to the merger, consolidation and restructuring
of the combined companies.

(4) Interest expense is net of interest income earned by Brandon.

(5) Prior to September 25, 1993, the Company's working capital and acquisition
financing were provided by Block. There was no interest charged on
intercompany debt. In conjunction with the IPO, effective September 25,
1993, Block formalized this arrangement by (i) providing a revolving credit
facility in the amount of $20,000 to fund the operating requirements of the
Company; (ii) converting $30,000 of intercompany indebtedness on such date
to a term loan and (iii) contributing $51,289 to the capital of the Company.
The earnings data for fiscal 1992 and 1993 give effect to this arrangement
as if it occurred at the beginning of the periods. Interest expense has been
computed at 6% and income taxes at the statutory rate.

(6) No cash dividend has ever been paid by Interim. However, prior to the
Brandon Merger, Brandon paid cash dividends.

(7) Certain reclassifications have been made to prior periods to conform to
current year presentation.

(8) At end of period.

A-2
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

INTRODUCTION

This discussion and analysis should be read in conjunction with the
Company's Consolidated Financial Statements and the related Notes included in
this Appendix to the Proxy Statement.

The Company operates within one industry segment, providing flexible
staffing in the United States, Canada, The Netherlands and parts of the United
Kingdom. The Company's business is organized into two divisions: Commercial and
HealthCare. The Commercial Division has two business lines, Commercial Staffing
and Professional Services. The HealthCare Division offers home care services as
well as special services.

The Company completed a merger with Brandon Systems Corporation ("Brandon"),
a strategic IT staffing company, on May 23, 1996, which was accounted for under
the pooling-of-interests method of accounting. Accordingly, the historical
information has been restated for all periods prior to the Brandon merger. All
other acquisitions to date have been accounted for under the purchase method of
accounting.

During the nine months ended December 30, 1994, the Company changed its
fiscal year from a 52- or 53-week year ending on the last Friday in March to a
52- or 53-week year ending on the last Friday in December. The change in fiscal
year was made to align the Company's year end more closely with the standard for
companies in the staffing industry. The financial statements have been restated,
for all years presented, to a 52- or 53-week year ending on the last Friday in
December.

GENERAL INDUSTRY TRENDS

Demand for staffing services has grown significantly as businesses continue
to increase reliance on flexible staff to manage operating costs and meet
fluctuating staffing requirements. In addition, many companies use flexible
staffing to reduce administrative overhead by outsourcing operations that are
not part of their core business competencies. Furthermore, the staffing
industry, while highly fragmented, is currently experiencing a trend toward
consolidation, which is contributing to above-market rates of growth for a
number of companies in the industry.

SALES OVERVIEW

System-wide sales data includes sales from all company-owned, franchised and
licensed offices. Sales data for franchised offices are derived from reports
provided by franchisees, which are not audited. During 1996, Company sales
increased by 22.8% to $1,834.3 million. From fiscal 1994 to 1996, system-wide
sales increased by 43.4%. Sales growth from 1994 through 1996 is due primarily
to the rapidly growing markets in which the Company operates, new branch
openings, and most recently, growth in Professional Services through the
acquisition of IT, legal and accounting branch offices.

Franchisee sales have decreased as a percentage of total sales due to a
slower rate of growth among franchisees and the repurchase of franchises by the
Company. Licensee sales in 1996 decreased as a percentage of total sales as a
result of the conversion of a large licensee to a franchisee.

The following table summarizes the Company's sales mix for the last three
fiscal years:

<TABLE>
<CAPTION>
FISCAL YEAR ENDED DECEMBER,
-------------------------------------
1996 1995 1994
----------- ----------- -----------
<S> <C> <C> <C>
Branch........................................................ 47.9% 40.8% 37.6%
Franchise..................................................... 39.2 43.9 47.2
License....................................................... 12.9 15.3 15.2
----- ----- -----
Total Sales................................................... 100.0% 100.0% 100.0%
----- ----- -----
----- ----- -----
</TABLE>

A-3
<PAGE>
REVENUE OVERVIEW

From 1994 through 1996, Commercial Division revenue increased as a
percentage of total Company revenue principally due to the accelerated growth
rate and acquisition activity in Professional Services.

<TABLE>
<CAPTION>
FISCAL YEAR ENDED DECEMBER,
-------------------------------------
1996 1995 1994
----------- ----------- -----------
<S> <C> <C> <C>
Commercial Division:
Commercial Staffing......................................... 52.5% 59.6% 61.2%
Professional Services....................................... 26.9 16.0 14.2
HealthCare Division........................................... 20.0 23.8 23.5
Other......................................................... 0.6 0.6 1.1
----- ----- -----
Total Revenues................................................ 100.0% 100.0% 100.0%
----- ----- -----
----- ----- -----
</TABLE>

The following table summarizes the Company's revenue mix for the last three
fiscal years:

<TABLE>
<CAPTION>
FISCAL YEAR ENDED DECEMBER,
-------------------------------------
1996 1995 1994
----------- ----------- -----------
<S> <C> <C> <C>
Branch........................................................ 76.7% 70.6% 68.3%
Franchise..................................................... 2.4 2.8 3.2
License....................................................... 20.3 26.0 27.4
Other......................................................... 0.6 0.6 1.1
----- ----- -----
Total Revenues................................................ 100.0% 100.0% 100.0%
----- ----- -----
----- ----- -----
</TABLE>

RESULTS FROM OPERATIONS OVERVIEW

During the past three years, the Company's gross profit margin remained
relatively stable as higher gross margins in Professional Services were
partially offset by (i) the growth of Commercial Staffing revenues, which have
lower gross profit margins, and (ii) the decline of franchise royalties (which
essentially contribute 100% to gross profit) as a percentage of total Company
revenues.

Selling, general and administrative expenses as a percentage of revenues
increased over the three years reflecting higher relative costs associated with
the growth of Professional Services. Additionally, due to the slower general
growth of licensee revenues as compared to branch revenues, licensee commissions
as a percentage of revenues has decreased.

A-4
<PAGE>
The following table sets forth operational results as a percentage of total
revenues for the periods indicated:

<TABLE>
<CAPTION>
FISCAL YEAR ENDED DECEMBER,
-------------------------------------
1996 1995 1994
----------- ----------- -----------
<S> <C> <C> <C>
Total Revenues................................................ 100.0% 100.0% 100.0%
Cost of Services.............................................. 69.4 69.4 69.7
----- ----- -----
Gross Profit (1).............................................. 30.6 30.6 30.3
Selling, General & Administrative............................. 21.2 20.5 19.6
Licensee Commissions.......................................... 3.4 4.3 4.8
----- ----- -----
Results from Operations....................................... 6.0 5.8 5.9
Merger Expense................................................ 0.8 -- --
Amortization of Intangibles................................... 0.8 0.8 0.8
Interest...................................................... 0.5 0.1 --
Taxes......................................................... 1.9 2.1 2.3
----- ----- -----
Net Earnings.................................................. 2.0% 2.8% 2.8%

Net Earnings (excluding merger expenses)...................... 2.7% 2.8% 2.8%
</TABLE>

- ------------------------

(1) During 1995, the Company reclassified certain non-payroll related costs from
cost of services to selling, general and administrative expenses to conform
to industry norms. The effect of this reclassification was to increase gross
profit by 0.4% in 1995.

FISCAL 1996 COMPARED TO 1995

REVENUES

Revenues in 1996 increased 32.7% to $1,147.2 million from $864.2 million in
the prior year. Commercial Staffing revenues increased 16.9% reflecting the
expansion of the Interim On-Premise program and an increase in the number of
offices and services provided. Professional Services revenues increased 123.5%
reflecting significant IT acquisition activity and internal growth. HealthCare
Division revenues increased 11.3% due to increases in the number of offices and
expansion of Occupational Health and Physicians services.

GROSS PROFIT

Gross profit increased 33.1% to $351.4 million from $264.1 million in the
prior year period. Increases in gross profit and cost of services are associated
with the increase in revenues. Gross profit margin was 30.6%, the same as last
year. Although the Company has added revenues of higher gross profit business
through acquisitions and increases in our Professional Services business, this
has been offset by a decline in franchise royalties as a percent of total
company revenue and an increase in the percentage of Commercial Division
revenues which generally have lower gross profit.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

Selling, general and administrative expenses increased 37.6% to $243.7
million from $177.1 million in the prior year period. Selling, general and
administrative expenses as a percentage of revenues were 21.2% compared to 20.5%
a year ago due to the higher relative costs associated with Professional
Services.

LICENSEE COMMISSIONS

Licensee commissions increased 5.9% to $39.5 million from $37.3 million in
the prior year period. Licensee commissions as a percentage of revenues
decreased from 4.3% to 3.4% due to the Company's

A-5
<PAGE>
repurchase activity, one licensee conversion to a franchise, and slower general
growth of licensee revenues as compared to branch revenue growth.

AMORTIZATION OF INTANGIBLES

Amortization expense increased 27.9% to $8.8 million from $6.9 million in
the prior year period reflecting the increase in intangible assets arising from
acquisitions.

TAXES ON EARNINGS

The effective tax rate of 49.0% in 1996 results from a large portion of
merger expenses, recorded in the first half of 1996, being nondeductible. The
effective tax rate, excluding the effects of nonrecurring merger expenses, was
43.0% compared to 43.2% in the prior year. The decline in the effective tax rate
is due primarily to the fact that during these periods amortization of certain
nondeductible intangibles remained relatively fixed while earnings before taxes
increased.

NET EARNINGS

Net earnings excluding merger expenses (net of taxes) increased 29.0% to
$30.6 million, or $1.83 per share, from $23.7 million, or $1.52 per share in the
prior year period. This represents a 20.9% increase in per share earnings.
Including merger expenses, net earnings decreased 3.0% to $23.0 million, or
$1.38 per share from $23.7 million or $1.52 per share in the prior year period.
The weighted average number of shares outstanding increased to 16,709,000 from
15,662,000 in the prior year period, primarily due to the additional shares
issued as a result of the secondary public offering on October 17, 1996.

FISCAL 1995 COMPARED TO 1994

REVENUES

Revenues in 1995 increased 22.6% (24.3% excluding the 53rd week in 1994) to
$864.2 million from $704.7 million in 1994. Commercial Staffing revenues
increased 19.5% (21.1% excluding the 53rd week in 1994) due to an increase in
the number of billed hours, offices acquired and continued internal office
expansion. Professional Services revenues increased 38.2% (38.9% excluding the
53rd week in 1994) primarily related to acquisitions that occurred in 1995.
HealthCare Division revenues increased 24.2% (26.8% excluding the 53rd week in
1994) due to continued expansion in home care.

GROSS PROFIT

Gross profit in 1995 increased 23.8% to $264.1 million from $213.3 million
in 1994 (22.4% excluding reclassifications adopted in 1995 in which certain
nonpayroll related costs were removed from cost of services to conform to
industry norms). The gross profit margin was 30.6% (30.2% excluding
reclassifications) as compared with 30.3% in the prior year.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

Selling, general and administrative expenses increased 28.5% to $177.1
million from $137.9 million in 1994. Selling, general and administrative
expenses as a percentage of total revenue increased to 20.5% in 1995 from 19.6%
in 1994 as a result of a full year of HealthCare Division acquisitions made in
1994 and a partial year of Professional Services acquisitions made in 1995.
Professional Services such as executive search, human resources, accounting and
therapy have a higher gross profit margin but require higher selling, general
and administrative expenditures as a percentage of revenue.

A-6
<PAGE>
LICENSEE COMMISSIONS

In 1995, licensee commissions increased 10.4% to $37.3 million from $33.8
million in 1994 as a result of an increased number of licensees.

AMORTIZATION OF INTANGIBLES

For 1995, amortization expense increased 14.0% to $6.9 million from $6.0
million in the prior year period reflecting the increase in intangible assets
arising from acquisitions.

TAXES ON EARNINGS

The provision for income taxes for 1995 reflects an effective tax rate of
43.2%, which is less than the 45.2% rate for 1994. The lower effective tax rate
for 1995 is the result of (i) a decrease in the effective rate relating to state
income taxes and (ii) nondeductible amortization of intangible assets remaining
fixed while earnings before income taxes increased.

NET EARNINGS

In 1995, net earnings increased 22.0% to $23.7 million from $19.5 million in
1994. Net earnings per share increased 20.6% to $1.52 in 1995 from $1.26 in
1994. The weighted average shares outstanding was 15,662,000 in 1995 compared to
15,391,000 in 1994.

LIQUIDITY AND CAPITAL RESOURCES

Historically, the Company financed its operations through cash generated by
operating activities and bank lines of credit. The Company's principal uses of
cash are funding acquisitions, capital expenditures, working capital needs and
repayment of debt. The nature of the Company's business requires payment of
wages to its flexible staff on a weekly, or bi-weekly basis, while payments from
clients are generally received 30-60 days after billing for Commercial Staffing
and Professional Services and 65 or more days for HealthCare clients. The
Company believes that its internally generated funds, the excess cash from the
secondary offering, and lines of credit are sufficient to support anticipated
levels of growth of the Company.

Net cash used in operating activities in 1996 was $6.1 million. Net cash
provided by operating activities was $6.6 million, and $10.1 million in years
1995 and 1994, respectively. The 1996 decrease in cash flow from operating
activities was primarily due to increased funding of higher days outstanding
accounts receivable and $7.6 million (after-tax) of merger expenses paid in
1996.

Investing activities used $29.3 million dollars in 1996, largely reflecting
capital expenditures and acquisitions, net of cash acquired. These investing
activities were partially offset by net proceeds of $15.6 million from the sale
of marketable securities used to pay down debt. Historically, Brandon invested
its cash in excess of immediately forseeable requirements principally in
interest-bearing marketable securities that Brandon classified as "available for
sale." The Company anticipates continued expenditures to continue development
and implementation of its information technologies. In 1996, the Company spent
approximately $8.8 million to build and furnish an addition to its corporate
headquarters, and approximately $11.0 million to upgrade and expand its on-line
network and computer equipment in both its headquarters and branch locations.

On October 17, 1996, the Company completed a public offering of 4.25 million
shares (3.95 million shares sold by the Company) of its $0.01 par value common
stock at $43.25 per share. Net proceeds to the Company were approximately $163.1
million, of which $131.7 million was used to repay borrowings under the
Company's credit facilities. The balance of the proceeds have been held in
short-term investments and will be used for continued growth both internally and
through acquisitions.

A-7
<PAGE>
DESCRIPTION OF COMPANY FINANCING

On April 6, 1994, the Company replaced a $30 million term loan and a $20
million revolving credit facility with Block with a new $50 million committed
senior revolving credit agreement. In November 1995, this facility was increased
to $150 million and in January 1997 was increased to $200 million. As of
December 27, 1996, the Company had no borrowings outstanding under this
agreement. The credit facility is available to fund the Company's acquisitions,
to supply working capital and to provide for general corporate needs. Interest
charged on the facility is based, at the Company's option, on either the banks'
base rate or LIBOR plus an applicable margin. The margin changes based on the
Company's leverage. The facility, which terminates January 15, 2002, contains
customary covenants, including the maintenance of
certain financial ratios such as minimum net worth and restrictions on the
incurrence of liens and additional indebtedness.

In addition, the Company has established short-term, unsecured, uncommitted
lines of credit with certain banks. These lines of credit are based on LIBOR and
are available to fund the Company's short-term capital requirements.

INFLATION

The effects of inflation on the Company's operations were not significant
during the periods presented in the financial statements.

SEASONALITY AND CYCLICALITY OF BUSINESS

The Company's businesses are not seasonal in nature. The Company's
commercial business has historically been considered to be cyclical, often
acting as a coincidental indicator of both economic downswings and upswings.
However, as a result of general shifting of employment patterns and the growth
in On-Premise and Professional Services, management believes that the Company's
commercial business is becoming less cyclical. In addition, the Company's health
care business is not cyclical and tends to dampen any cyclical effects from the
commercial sector. No single customer accounts for more than 1% of the Company's
sales.

SUBSEQUENT EVENT

On March 3, 1997, the Company announced a cash tender offer to purchase all
of the outstanding shares of Michael Page Group PLC, a U.K.-based international
provider of recruitment and staffing. Michael Page Group PLC 1996 revenues were
$220 million, with pre-tax income of $48 million. The transaction is valued at
approximately $574 million. The Company expects to complete the tender offer
within 90 days and will finance the acquisition under a $675 million senior loan
facility.

A-8
<PAGE>
INDEPENDENT AUDITORS' REPORT

To the Board of Directors
of Interim Services Inc.
Fort Lauderdale, Florida

We have audited the accompanying consolidated balance sheets of Interim
Services Inc. and subsidiaries as of December 27, 1996 and December 29, 1995,
and the related consolidated statements of earnings, stockholders' equity and
cash flows for each of the three years in the period ended December 27, 1996.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements based
on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in
all material respects, the financial position of Interim Services Inc. and
subsidiaries as of December 27, 1996 and December 29, 1995, and the results of
their operations and their cash flows for each of the three years in the period
ended December 27, 1996 in conformity with generally accepted accounting
principles.

/s/ Deloitte & Touche LLP
Fort Lauderdale, Florida
February 5, 1997

A-9
<PAGE>
INTERIM SERVICES INC.

CONSOLIDATED STATEMENTS OF EARNINGS

(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
YEARS ENDED
------------------------------------
DEC. 27, DEC. 29, DEC. 30,
1996 1995 1994
------------ ---------- ----------
<S> <C> <C> <C>
Revenues................................................................... $ 1,147,151 $ 864,247 $ 704,696
Cost of services........................................................... 795,789 600,169 491,404
------------ ---------- ----------
Gross profit............................................................. 351,362 264,078 213,292
------------ ---------- ----------
Selling, general and administrative expenses............................... 243,652 177,105 137,859
Licensee commissions....................................................... 39,500 37,295 33,796
Amortization of intangibles................................................ 8,802 6,884 6,041
Interest expense........................................................... 5,696 990 112
Merger expense............................................................. 8,600 -- --
------------ ---------- ----------
306,250 222,274 177,808
------------ ---------- ----------

EARNINGS BEFORE TAXES...................................................... 45,112 41,804 35,484

Income taxes............................................................... 22,097 18,071 16,028
------------ ---------- ----------
NET EARNINGS............................................................. $ 23,015 $ 23,733 $ 19,456
------------ ---------- ----------
------------ ---------- ----------
NET EARNINGS PER COMMON AND COMMON EQUIVALENT SHARES....................... $ 1.38 $ 1.52 $ 1.26
------------ ---------- ----------
------------ ---------- ----------
WEIGHTED AVERAGE SHARES OUTSTANDING........................................ 16,709 15,662 15,391
------------ ---------- ----------
------------ ---------- ----------
</TABLE>

See notes to Consolidated Financial Statements

A-10
<PAGE>
INTERIM SERVICES INC.

CONSOLIDATED BALANCE SHEETS

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
DEC. 27, DEC. 29,
1996 1995
---------- ----------
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents......................................................... $ 18,938 $ 4,025
Marketable securities:
Available for sale.............................................................. -- 15,675
Trading securities.............................................................. 7,499 --
Receivables, less allowance for doubtful accounts of $3,023 and $2,176............ 186,732 143,209
Insurance deposits................................................................ 32,794 33,547
Other current assets.............................................................. 18,301 9,270
---------- ----------
Total current assets.............................................................. 264,264 205,726
Intangible assets, net.............................................................. 174,747 171,529
Property and equipment, net......................................................... 49,795 27,128
Other assets........................................................................ 23,684 20,106
---------- ----------
$ 512,490 $ 424,489
---------- ----------
---------- ----------

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Notes payable to banks............................................................ $ -- $ 54,727
Accounts payable and other accrued expenses....................................... 27,092 25,829
Accrued salaries, wages and payroll taxes......................................... 40,948 30,005
Accrued insurance................................................................. 26,782 26,180
Dividend payable.................................................................. -- 372
Accrued income taxes.............................................................. 159 1,087
---------- ----------
Total current liabilities......................................................... 94,981 138,200
Long-Term Obligations............................................................... -- 60,000
Deferred Tax Liability.............................................................. 2,798 --
Commitments and contingencies
Stockholders' Equity:
Preferred stock, par value $.01 per share; authorized--2,500,000 shares; none
issued or outstanding...........................................................
Common stock, par value $.01 per share; authorized--50,000,000 and 25,000,000
shares; issued and outstanding--19,476,684 and 15,376,248 shares................ 195 154
Additional paid-in capital........................................................ 251,236 85,121
Treasury stock.................................................................... (460) --
Unrealized gain on marketable securities.......................................... -- 26
Retained earnings................................................................. 163,740 140,988
---------- ----------
Total stockholders' equity.......................................................... 414,711 226,289
---------- ----------
$ 512,490 $ 424,489
---------- ----------
---------- ----------
</TABLE>

See notes to Consolidated Financial Statements.

A-11
<PAGE>
INTERIM SERVICES INC.

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

<TABLE>
<CAPTION>
UNREALIZED
GAIN (LOSS)
ADDITIONAL ON
COMMON PAID IN TREASURY MARKETABLE RETAINED
STOCK CAPITAL STOCK SECURITIES EARNINGS TOTAL
----------- ---------- ----------- ------------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Balance as of December 24, 1993............ $ 138 $ 57,197 $ -- $ -- $ 100,659 $ 157,994
Net earnings............................... -- -- -- -- 19,456 19,456
Transactions of pooled company............. 1 612 -- (72) (1,105) (564)
Change in foreign currency translation
adjustment............................... -- -- -- -- (262) (262)
Proceeds from exercise of over-allotment
options, net of expenses of $1,725....... 15 28,260 -- -- -- 28,275
----- ---------- ----- --- ---------- ----------
Balance as of December 30, 1994............ 154 86,069 -- (72) 118,748 204,899
Net earnings............................... -- -- -- -- 23,733 23,733
Transactions of pooled company............. (1,349) -- 98 (1,308) (2,559)
Change in foreign currency translation
adjustment............................... -- -- -- -- (185) (185)
Proceeds from exercise of employee stock
options.................................. -- 401 -- -- -- 401
----- ---------- ----- --- ---------- ----------
Balance as of December 29, 1995............ 154 85,121 -- 26 140,988 226,289
Net earnings............................... -- -- -- -- 23,015 23,015
Transactions of pooled company............. 271 -- -- (373) (102)
Change in foreign currency translation
adjustment............................... -- -- -- -- 110 110
Proceeds from exercise of employee stock
options.................................. 1 2,502 -- -- -- 2,503
Sale of 3,950,000 shares of common stock in
a public offering, net................... 40 162,635 -- -- -- 162,675
Repurchase of 13,178 shares................ -- -- (460) -- -- (460)
Stock option tax benefits.................. -- 615 -- -- -- 615
Issuance of 2,135 shares................... -- 92 -- -- -- 92
Reversal of unrealized gain on marketable
securities............................... -- -- -- (26) -- (26)
----- ---------- ----- --- ---------- ----------
Balance as of December 27, 1996............ $ 195 $ 251,236 $ (460) $ -- $ 163,740 $ 414,711
----- ---------- ----- --- ---------- ----------
----- ---------- ----- --- ---------- ----------
</TABLE>

See notes to Consolidated Financial Statements.

A-12
<PAGE>
INTERIM SERVICES INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
YEARS ENDED
------------------------------------
DEC. 27, DEC. 29, DEC. 30,
1996 1995 1994
----------- ----------- ----------
<S> <C> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings.............................................................. $ 23,015 $ 23,733 $ 19,456
Adjustments to reconcile net earnings to net cash from operating
activities:
Depreciation and amortization........................................... 18,911 14,556 12,173
Provision for (Benefit from) deferred taxes on income................... 687 (74) 775
Changes in assets and liabilities, net of effects of acquisitions:
Receivables........................................................... (40,724) (27,458) (19,118)
Trading securities.................................................... (7,499) -- --
Insurance deposits.................................................... 753 (6,138) (7,215)
Other current assets.................................................. (6,308) (2,334) 285
Other assets.......................................................... (5,199) (9,527) (5,324)
Accounts payable and accrued expenses................................. (280) 3,143 3,825
Accrued salaries, wages and payroll taxes............................. 9,434 10,481 6,420
Accrued insurance..................................................... 602 (54) 1,928
Accrued income taxes.................................................. (928) 460 (2,810)
Other................................................................. 1,437 (226) (335)
----------- ----------- ----------
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES................... (6,099) 6,562 10,060
----------- ----------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures...................................................... (32,982) (11,303) (9,576)
Purchases of marketable securities........................................ (1,123) (16,910) (10,276)
Proceeds from sales of marketable securities.............................. 16,754 11,736 9,106
Decrease in deposits...................................................... -- 35 (4)
Acquisitions, net of cash acquired........................................ (11,964) (98,990) (10,758)
----------- ----------- ----------
NET CASH USED IN INVESTING ACTIVITIES................................. (29,315) (115,432) (21,508)
----------- ----------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
(Repayments) Issuances of notes payable................................... (114,727) 108,218 6,100
Transactions of pooled company............................................ (103) (2,596) (421)
Purchase of treasury stock................................................ (460) -- --
Proceeds from secondary stock offering.................................... 163,114 -- --
Repayments to H&R Block................................................... -- -- (30,000)
Proceeds from exercise of employee stock options.......................... 2,503 401 --
Proceeds from exercise of over-allotment option........................... -- -- 28,275
----------- ----------- ----------
NET CASH PROVIDED BY FINANCING ACTIVITIES............................. 50,327 106,023 3,954
----------- ----------- ----------
Net Increase/(decrease) in cash and cash equivalents...................... 14,913 (2,847) (7,494)
Cash and cash equivalents, beginning of period............................ 4,025 6,872 14,366
----------- ----------- ----------
Cash and cash equivalents, end of period.................................. $ 18,938 $ 4,025 $ 6,872
----------- ----------- ----------
----------- ----------- ----------
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Income taxes paid......................................................... $ 21,602 $ 17,570 $ 16,911
----------- ----------- ----------
----------- ----------- ----------
Interest paid............................................................. $ 6,546 $ 1,452 $ 528
----------- ----------- ----------
----------- ----------- ----------
</TABLE>

See notes to Consolidated Financial Statements.

A-13
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

1. ORGANIZATION

HISTORY--Prior to January 27, 1994, the effective date of its initial public
offering, Interim Services Inc. ("Interim" or the "Company") was a wholly-owned
subsidiary of H&R Block, Inc. ("Block"). On January 27, 1994, Block completed
the sale at $20 per share of 10 million shares of the Company, its entire
holdings. On January 28, 1994, the Company's shares commenced trading on the
Nasdaq Stock Market. In addition, the underwriters for the offering exercised
their over-allotment option and purchased from the Company an additional 1.5
million shares at $20 per share. The net proceeds to the Company were $28,275.

On August 7, 1996 Interim Common Stock began trading on the New York Stock
Exchange. On October 17, 1996 the Company completed a public offering of
4,250,000 shares of its $.01 par value common stock (300,000 shares were sold by
certain selling shareholders and 3,950,000 shares were sold by the Company) at
$43.25 per share. Net proceeds to the Company were $163,114.

BUSINESS--The Company is a leader in providing a comprehensive range of
customized staffing solutions, including flexible staffing, home care, full-time
placement, consulting and other value-added services on a national basis to
businesses, professional and service organizations, governmental agencies,
health care facilities and individuals. The Company operates through a network
of offices throughout the United States, Canada, The Netherlands and the United
Kingdom.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

PRINCIPLES OF CONSOLIDATION--The consolidated financial statements include
the accounts of the Company and its wholly-owned subsidiaries. All material
intercompany transactions and balances have been eliminated.

RECLASSIFICATIONS--Certain amounts in the prior years' consolidated
financial statements have been reclassified to conform to the current year's
presentation.

PERVASIVENESS OF ESTIMATES--The preparation of financial statements in
conformity with generally accepted accounting principles requires management to
make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Due to the inherent uncertainty involved in making
estimates, actual results reported in future periods may be based upon amounts
which differ from those estimates.

FISCAL YEAR--The Company's fiscal year is comprised of 52 or 53 weeks,
ending on the last Friday in December. The fiscal years ended December 27, 1996,
December 29, 1995 and December 30, 1994 included 52, 52 and 53 weeks
respectively.

CASH AND CASH EQUIVALENTS--The Company considers all highly liquid
investments with a remaining maturity of 90 days or less at the time of purchase
to be cash equivalents. Cash equivalents are carried at cost which approximates
fair value.

MARKETABLE SECURITIES--Marketable securities are comprised of readily
marketable debt securities with remaining maturities of more than 90 days at the
time of purchase. The Company has classified its current investment portfolio as
trading securities and the carrying value of such securities has been adjusted
to fair market value, which was not materially different from cost. Prior to the
merger with Brandon, Brandon had classified its investments as available for
sale.

A-14
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
ALLOWANCE FOR DOUBTFUL ACCOUNTS--The Company carries accounts and notes
receivable at the amount it deems to be collectible. Accordingly, the Company
provides allowances for accounts and/or notes receivable it deems to be
uncollectible based on management's best estimates. Recoveries are recognized in
the period they are received. The ultimate amount of accounts and/or notes
receivable that become uncollectible could differ from those estimated.

INTANGIBLE ASSETS--The excess of cost of franchise and independent offices
acquired over the fair value of net assets acquired is being amortized on a
straight-line basis over periods of approximately 29 years. The Company
evaluates the recoverability of its investment in such intangible assets in
relation to anticipated cash flows on an undiscounted basis. If the estimated
future cash flows are projected to be less than the carrying value, an
impairment write-down would be recorded.

REVENUES--The Company generates revenues from sales of services by its own
branch and licensed operations and from royalties earned on sales of services by
its franchise operations. Franchise royalties, which are included in revenues,
were $27,009, $24,316 and $22,790 for the years ended December 27, 1996,
December 29, 1995 and December 30, 1994, respectively. Revenues and the related
labor costs and payroll taxes are recorded in the period in which the service is
performed.

The Company utilizes two forms of franchising agreements. Under the first
form, the Company records franchise royalties, based upon the contractual
percentage of franchise sales, in the period in which the franchise provides the
service. Under the second form (termed "licensee" by the Company), revenues
generated by the franchisee operations and related direct costs are included as
part of the Company's revenues and cost of services, respectively. The net
distribution paid to the licensee is based upon a percentage of the gross profit
generated, and is captioned "licensee commissions" in the Consolidated
Statements of Earnings.

Revenues generated from the sales and licensing of franchises, and initial
franchise fees, are recognized when the Company has performed substantially all
of its obligations under its franchise agreements and when collectibility of
such amounts is reasonably assured.

DEPRECIATION AND AMORTIZATION--Buildings and equipment are depreciated over
the estimated useful lives of the assets using the straight-line method.
Leasehold improvements are amortized over the shorter of their estimated useful
life or the lease term using the straight-line method. Maintenance and repairs
are expensed as incurred. Expenditures which significantly increase the value of
the assets or extend useful lives are capitalized.

WORKERS' COMPENSATION BENEFITS--The Company's workers' compensation coverage
is retrospectively rated based upon ultimate incurred losses and loss adjustment
expenses. Workers' compensation costs are accrued based upon the aggregate of
the liability for reported claims and loss adjustment expenses and an
actuarially determined estimated liability for claims incurred but not reported.

The Company funds its workers' compensation program through deposits with
insurance carriers who administer and pay reported claims. These deposits are
reflected as insurance deposits on the accompanying Consolidated Balance Sheets
and are reduced as claims and administrative costs are paid.

The Company also has a captive insurance company that provides general
liability insurance to franchise, license and company-owned locations.

A-15
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
INCOME TAXES--The Company accounts for income taxes under an asset and
liability approach which requires the recognition of deferred tax assets and
liabilities for expected future tax consequences of temporary differences
between tax bases and financial reporting bases of assets and liabilities.

EARNINGS PER SHARE--Earnings per share are computed based upon the weighted
average number of common and common equivalent shares outstanding during the
respective years. Earnings per share, assuming full dilution, has not been shown
as there would be no material dilution.

DISCLOSURE REGARDING FINANCIAL INSTRUMENTS--The carrying amounts of cash and
cash equivalents, accounts receivable, accounts payable and accrued expenses
approximate fair value due to the relatively short maturity of the respective
instruments. For marketable securities fair values are based on quoted market
prices.

The carrying amounts of notes payable to banks and long-term debt
obligations issued pursuant to the Company's bank credit agreements and
revolving credit facility approximate fair value because the interest rates on
these instruments change with market interest rates.

STOCK BASED COMPENSATION--Statement of Financial Accounting Standards (SFAS)
No. 123, "Accounting for Stock-Based Compensation," encourages, but does not
require companies to record compensation cost for stock-based employee
compensation plans at fair value. The Company has chosen to continue to account
for stock-based compensation to employees using the intrinsic value method as
prescribed by Accounting Principles Board Opinion (APB) No. 25, "Accounting for
Stock Issued to Employees," and related Interpretations. Accordingly,
compensation cost for stock options issued to employees is measured as the
excess, if any, of the quoted market price of the Company's stock at the date
for grant over the amount an employee must pay for the stock. Compensation cost
related to restricted stock granted as part of bonus compensation is recognized
in the period the bonus is earned and measured using the quoted market price on
the effective grant date. Compensation cost related to stock options of
non-employees is recorded at fair value (in accordance with SFAS No. 123).

3. MERGERS AND ACQUISITIONS

BRANDON SYSTEMS CORPORATION

On May 23, 1996, the Company completed its merger with Brandon Systems
Corporation ("Brandon"), an information technology staffing company. The Company
issued 3,872,690 shares of its common stock in exchange for 100% of the
outstanding shares of Brandon common stock. In addition, Brandon stock options
outstanding at the effective time of the merger were converted into options to
purchase an aggregate of 207,592 additional Interim common shares.

The merger has been accounted for as a pooling-of-interests for accounting
and financial reporting purposes. The pooling-of-interests method of accounting
is intended to present as a single interest two or more common shareholders'
interests which were previously independent; accordingly, the historical
financial statements for the periods prior to the merger are restated as though
the companies had been combined. The restated financial statements are adjusted
to conform the accounting policies of the combined companies and fiscal
reporting periods of the Company.

All fees and expenses related to the merger and the consolidation and
restructuring of the combined companies have been expensed as required under the
pooling-of-interests accounting method and are reflected in the consolidated
statements of earnings for the period ending December 27, 1996. Such fees

A-16
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

3. MERGERS AND ACQUISITIONS (CONTINUED)
and expenses approximate $8,600 ($7,593 after tax) and include investment
banking, legal and accounting fees, severance and benefit-related costs, and
other costs of consolidating operations.

The following summarizes amounts previously reported by Interim and Brandon
prior to the transaction:

<TABLE>
<CAPTION>
QUARTERS ENDED YEARS ENDED
---------------------- ----------------------
MAR. 29, MAR. 31, DEC. 29, DEC. 30,
1996 1995 1995 1994
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Revenues:
Interim.............................................. $ 242,414 $ 173,517 $ 780,886 $ 634,417
Brandon.............................................. 22,311 20,135 83,361 70,279
---------- ---------- ---------- ----------
Combined........................................... $ 264,725 $ 193,652 $ 864,247 $ 704,696
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Net earnings:
Interim.............................................. $ 4,245 $ 3,241 $ 17,527 $ 14,157
Brandon.............................................. 1,244 1,451 6,206 5,299
---------- ---------- ---------- ----------
Combined........................................... $ 5,489 $ 4,692 $ 23,733 $ 19,456
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Net earnings per share:
Interim.............................................. $ 0.27 $ 0.21 $ 1.12 $ 0.92
Brandon.............................................. 0.08 0.09 0.40 0.34
---------- ---------- ---------- ----------
Combined........................................... $ 0.35 $ 0.30 $ 1.52 $ 1.26
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
</TABLE>

COMPUTER POWER GROUP

Effective December 1, 1995, the Company acquired the U.S. and U.K. based
assets of Computer Power Group ("CPG"), a subsidiary of Australia-based Computer
Power Group, Ltd., for $71,000 in cash. Computer Power Group provides staffing
and consulting services in a variety of information technology disciplines. This
acquisition was accounted for under the purchase method of accounting.
Accordingly, the operations of CPG are included in the Consolidated Statements
of Earnings from the date of acquisition. The excess of the purchase price over
the fair value of the net tangible assets acquired (goodwill) was $56,618 and is
being amortized over 40 years.

OTHER

During 1996, 1995, and 1994, the Company made certain other acquisitions
which were accounted for under the purchase method of accounting. Their
operations are included in the Consolidated Statements of Earnings from the date
of acquisition. Had the acquisitions during 1996 and 1994 taken place at the
beginning of the year in which they occurred, pro forma operating results would
not have been significantly different from those reported.

The following unaudited pro forma consolidated results of operations give
effect to the acquisitions made during 1995 as though they occurred at the
beginning of 1995 and 1994 with pro forma adjustments

A-17
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

3. MERGERS AND ACQUISITIONS (CONTINUED)
to give effect to amortization of goodwill, interest expense on additional
borrowings used to fund the acquisitions, and other adjustments, together with
income tax effects.

<TABLE>
<CAPTION>
DEC. 29, DEC. 30,
1995 1994
---------- ----------
<S> <C> <C>
Revenues from services.......................................................... $ 969,652 $ 806,178
Net earnings.................................................................... $ 23,974 $ 17,706
Net earnings per common and common equivalents.................................. $ 1.53 $ 1.15
</TABLE>

The unaudited pro forma information is not necessarily indicative either of
results of operations that would have occurred had the purchases been made at
the beginning of 1995 and 1994, or future results of the continued companies.

4. INTANGIBLE ASSETS

A summary of intangible assets is as follows:

<TABLE>
<CAPTION>
WEIGHTED WEIGHTED WEIGHTED
AVERAGE LIFE DEC. 27, AVERAGE LIFE DEC. 29, AVERAGE LIFE DEC. 30,
(IN YEARS) 1996 (IN YEARS) 1995 (IN YEARS) 1994
------------- ---------- ------------- ---------- ------------- ----------
<S> <C> <C> <C> <C> <C> <C>
Excess of cost over fair value of net
assets acquired...................... 29 $ 214,416 29 $ 202,351 23 $ 116,670
Customer lists......................... 5 1,986 5 1,985 5 1,706
Non-compete agreements................. 5 2,475 5 2,376 5 1,581
Other intangible assets................ 5 494 5 516 5 531
-- -- --
---------- ---------- ----------
29 219,371 29 207,228 22 120,488
Less accumulated amortization.......... (44,624) (35,699) (28,789)
---------- ---------- ----------
$ 174,747 $ 171,529 $ 91,699
---------- ---------- ----------
---------- ---------- ----------
</TABLE>

Amortization of intangible assets is as follows:

<TABLE>
<CAPTION>
YEARS ENDED
-------------------------------------
DEC. 27, DEC. 29, DEC. 30,
1996 1995 1994
----------- ----------- -----------
<S> <C> <C> <C>
Excess of cost over fair value of net assets acquired...................... $ 8,241 $ 6,021 $ 5,536
Customer lists............................................................. 309 269 317
Non-compete agreements..................................................... 194 533 132
Other intangible assets.................................................... 58 61 56
----------- ----------- -----------
$ 8,802 $ 6,884 $ 6,041
----------- ----------- -----------
----------- ----------- -----------
</TABLE>

A-18
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

5. PROPERTY AND EQUIPMENT

A summary of property and equipment follows:

<TABLE>
<CAPTION>
DEC. 27, DEC. 29,
1996 1995
---------- ----------
<S> <C> <C>
Land............................................................................ $ 4,167 $ 3,817
Buildings....................................................................... 11,394 3,824
Equipment....................................................................... 60,453 42,135
Software........................................................................ 14,270 7,306
Leasehold improvements.......................................................... 2,387 2,228
Construction in progress........................................................ 32 1,009
---------- ----------
92,703 60,319
Less accumulated depreciation and amortization.................................. (42,908) (33,191)
---------- ----------
$ 49,795 $ 27,128
---------- ----------
---------- ----------
</TABLE>

Depreciation and amortization of property and equipment for the years ended
December 27, 1996, December 29, 1995, and December 30, 1994 amounted to $10,109,
$7,672 and $6,132, respectively.

6. CREDIT FACILITIES

SHORT-TERM:

The Company has uncommitted lines of credit with several banks based on
LIBOR which are available to fund the Company's short-term capital requirements.
As of December 27, 1996, the Company had no borrowings outstanding under these
agreements. As of December 29, 1995, the Company had borrowings outstanding of
$54,727 under these agreements at an effective interest rate of 6.2%.

LONG-TERM:

On April 6, 1994, the Company replaced a $30,000 term loan and a $20,000
revolving credit facility with a new five-year $50,000 committed senior
revolving credit agreement. In November 1995, this facility was increased to
$150,000 and increased to $200,000 in January 1997. This credit facility is
available to fund the Company's general corporate needs, to fund working capital
and to fund acquisitions. Interest charged on the facility is based, at the
Company's option, on either the banks' base rate or LIBOR plus an applicable
margin. The margin changes based on the Company's leverage. The facility
contains customary covenants, which include the maintenance of certain financial
ratios including minimum net worth, restrictions on the incurrence of liens and
additional indebtedness. This facility terminates on January 15, 2002. As of
December 27, 1996, the Company had no borrowings outstanding under this
facility, and was in compliance with all of its terms. As of December 29, 1995
the Company had borrowings outstanding of $60,000 under this facility at an
effective interest rate of 6.2%.

A-19
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

7. INCOME TAXES

The provision for income taxes is comprised of the following:

<TABLE>
<CAPTION>
YEARS ENDED
-------------------------------
DEC. 27, DEC. 29, DEC. 30,
1996 1995 1994
--------- --------- ---------
<S> <C> <C> <C>
Current
Federal.............................................................. $ 17,300 $ 14,509 $ 12,230
State and local...................................................... 4,110 3,636 3,023
--------- --------- ---------
21,410 18,145 15,253
Deferred............................................................... 687 (74) 775
--------- --------- ---------
$ 22,097 $ 18,071 $ 16,028
--------- --------- ---------
--------- --------- ---------
</TABLE>

Deferred tax expense results from temporary differences in the recognition
of revenue and expense for tax and financial statement purposes. The sources of
these differences and the tax effect of each for 1995 and 1994 are immaterial
and for the year ended December 27, 1996 were:

<TABLE>
<S> <C>
Employee benefits.......................................................... $ (2,275)
Receivables allowances..................................................... (412)
Depreciation............................................................... 2,185
Amortization of intangibles................................................ 1,302
Other...................................................................... (113)
---------
$ 687
---------
---------
</TABLE>

The following table reconciles the U.S. Federal income tax rate to the
Company's effective tax rate:

<TABLE>
<CAPTION>
YEARS ENDED
-------------------------------------
DEC. 27, DEC. 29, DEC. 30,
1996 1995 1994
----------- ----------- -----------
<S> <C> <C> <C>
Statutory Rate...................................................... 35.0% 35.0% 35.0%
Increase (decrease) in rate resulting from:
State and local income taxes, net of federal benefit................ 6.2 5.6 5.8
Nondeductible amortization of intangibles........................... 3.6 3.9 4.7
Merger expense...................................................... 4.7 -- --
Other............................................................... (0.5) (1.3) (0.3)
----------- ----------- -----------
49.0% 43.2% 45.2%
----------- ----------- -----------
----------- ----------- -----------
</TABLE>

A-20
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

7. INCOME TAXES (CONTINUED)
Significant components of the Company's deferred tax assets and liabilities
are as follows:

<TABLE>
<CAPTION>
YEARS ENDED
--------------------
DEC. 27, DEC. 29,
1996 1995
--------- ---------
<S> <C> <C>
Current deferred tax assets (liabilities):
Employee benefits................................................................ $ 2,935 $ 660
Receivables reserves............................................................. 1,114 820
Intangible assets................................................................ 41 59
Other............................................................................ 87 14
--------- ---------
4,177 1,553
--------- ---------
Noncurrent deferred tax assets (liabilities):
Fixed assets..................................................................... (1,688) 498
Intangible assets................................................................ (1,075) 209
Receivables reserves............................................................. 118 --
Other............................................................................ (153) (194)
--------- ---------
(2,798) 513
--------- ---------
Net deferred tax assets............................................................ $ 1,379 $ 2,066
--------- ---------
--------- ---------
</TABLE>

8. EMPLOYEE BENEFIT PLANS

The Company and Brandon each maintain voluntary defined contribution 401(k)
profit sharing plans covering all eligible employees as defined in the
respective plan documents. For Interim employees, the plan provides a
discretionary matching contribution of up to 25% of employee contributions up to
6% of compensation contributed by eligible employees. In years when budget
objectives are attained, the plan provides for up to an additional 25% matching
contribution payable in Interim Common Stock. For Brandon employees, the
discretionary matching contribution permitted by the plan is equal to 25% of the
first 6% of compensation contributed by eligible full-time salaried employees.
In addition, each year the Company may elect to make a profit sharing
contribution to eligible full-time salaried employees. Contributions, net of
forfeitures, by the Company under these plans amounted to $393, $666 and $756
for the years ended December 27, 1996, December 29, 1995 and December 30, 1994,
respectively.

During 1995, the Company started a deferred compensation plan for selected
highly compensated employees who are not eligible to participate in the
Company's 401(k) savings plan. The plan allows eligible employees to defer
receipt of a portion (not less than 2 percent nor more than 10 percent) of their
compensation. The Company provides a discretionary matching contribution of up
to 25% of employee contributions up to 6 percent. In years when budget
objectives are attained, the Company provides an additional 25% matching
contribution. The matching contributions vest on a graduated scale from two to
five years of service. The deferred compensation, along with the Company
matching amounts and accumulated investment earnings, is accrued but unfunded.
Such accrual amounted to $1,821 and $710 at December 27, 1996 and December 29,
1995, respectively. Contributions by the Company under this plan amounted to
$144 and $149 for the years ended December 27, 1996 and December 29, 1995.

A-21
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

9. STOCK-BASED COMPENSATION PLANS

The Company has three stock option plans and a bonus plan under which a
portion of the bonus payable to certain employees is paid in restricted Common
Stock. These plans provide for the granting of stock options and restricted
shares of the Company's Common Stock. In addition, the Company's Outside
Directors' Compensation Plan provides for the annual retainer to be paid in the
form of the Company's Common Stock.

The three stock options plans are: the 1993 Long-Term Executive Compensation
Plan, the 1993 Stock Option Plan for Outside Directors and the 1994 Stock Option
Plan for Franchisees, Licensees and Agents. Under the plans, options may be
granted to outside directors, selected employees and franchisees, licensees and
agents to purchase the Company's Common Stock for periods not to exceed ten
years at a price that is not less than 100 percent of fair market value on the
date of grant. Options under the Long-Term Executive Compensation Plan are
generally exercisable (if certain qualifying criteria are met) starting one year
from the date of grant on a cumulative basis at the annual rate of 33 1/3
percent of the total number of optioned shares. Options under the Outside
Directors Plan are exercisable in full one year after the date of grant. Options
under the Franchisees, Licensees and Agents Plan are exercisable starting one
year from the date of grant on a cumulative basis at an annual rate that varies
during the first five years of the options' term at which time they become fully
exercisable. In October 1993, the Company reserved a total of 1,000,000 shares,
and on May 11, 1995 and May 9, 1996 an additional total of 350,000 and 450,000
shares, respectively, of common stock for issuance under the foregoing plans. On
January 27, 1994, the first options under these plans were granted.

As part of the Company's Bonus Plan, the Board of Directors has authorized
10,000 shares of Common Stock to be used for payment of a portion of the bonus
payable to certain employees in the form of restricted shares of the Company's
Common Stock. These shares vest ratably over a three year period and are
contingent upon future employment status with the Company.

Prior to the merger, Brandon had also adopted a stock option plan under
which 235,900 options to purchase its common shares were outstanding and
unexercised at the date of the merger. Such options were converted into options
to purchase an aggregate of 207,592 shares of the Company's Common Stock at a
price equivalent (after conversion) to the original grant price (which was not
less than the estimated fair value of Brandon common stock at grant date).
Changes under these plans for 1996, 1995 and 1994 giving retroactive effect to
the conversion of the Brandon stock options upon their original grant dates were
as follows:

<TABLE>
<CAPTION>
1996 1995 1994
----------------------- ----------------------- ----------------------
WEIGHTED WEIGHTED WEIGHTED
AVERAGE AVERAGE AVERAGE
EXERCISE EXERCISE EXERCISE
SHARES PRICE SHARES PRICE SHARES PRICE
---------- ----------- ---------- ----------- --------- -----------
<S> <C> <C> <C> <C> <C> <C>
Outstanding at beginning of year............. 1,101,711 $ 21.19 807,105 $ 18.56 234,546 $ 9.43
Granted...................................... 420,163 38.01 413,085 25.72 666,913 20.70
Exercised.................................... (140,846) 18.98 (47,403) 14.98 (60,648) 7.37
Forfeited.................................... (59,751) 28.50 (71,076) 21.78 (33,706) 17.62
---------- ---------- ---------
Outstanding at end of year................... 1,321,277 26.47 1,101,711 21.19 807,105 18.56

Options exercisable at year-end.............. 463,984 $ 19.65 325,023 $ 15.55 174,021 $ 10.41

Weighted average fair value of options
granted during the year.................... $ 8.07 $ 5.52
</TABLE>

A-22
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

9. STOCK-BASED COMPENSATION PLANS (CONTINUED)
The following table summarizes information about fixed stock options
outstanding at December 27, 1996:

<TABLE>
<CAPTION>
OPTIONS OUTSTANDING
----------------------------------------- OPTIONS EXERCISABLE
WEIGHTED ------------------------
AVERAGE WEIGHTED WEIGHTED
NUMBER REMAINING AVERAGE NUMBER AVERAGE
OUTSTANDING CONTRACTUAL EXERCISE EXERCISABLE EXERCISE
RANGE OF EXERCISE PRICES AT 12/27/96 LIFE PRICE AT 12/27/96 PRICE
- ---------------------------------------------------- ----------- --------------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C>
$ 9.09 - $19.99..................................... 125,487 2.67 $ 11.23 119,987 $ 11.23
$20.00 - $25.99..................................... 755,165 7.59 22.61 318,360 21.89
$26.00 - $31.99..................................... 12,000 8.34 28.88 12,000 28.88
$32.00 - $37.99..................................... 373,966 9.06 36.86 13,637 33.63
$38.00 - $42.99..................................... 29,008 9.63 41.02 -- --
$43.00 - $48.00..................................... 25,651 9.39 45.21 -- --
----------- --- ----------- ----------- -----------
$ 9.09 - $48.00..................................... 1,321,277 7.62 $ 26.47 463,984 $ 19.65
</TABLE>

The Company applies APB No. 25 and related interpretations in accounting for
its stock option plans for employees as described in Note 2--Summary of
Significant Accounting Policies. Accordingly, no compensation expense has been
recognized in 1996 or 1995 related to these plans. The compensation cost that
has reduced pretax income for its restricted stock and nonemployee stock option
plans was immaterial in the years 1996, 1995, and 1994, respectively. In
addition, these compensation cost would have been increased by $2,136 ($1,524
after tax, $.09 per share) and $890 ($632 after tax, $.04 per share) in 1996,
and 1995, respectively, had the fair values of stock options granted been
recognized as compensation cost as prescribed by SFAS No. 123.

The fair value of options at grant date was estimated using the
Black-Scholes multiple option model where each vesting increment is treated as a
separate option with its own expected life and own fair value. The following
weighted average assumptions were used:

<TABLE>
<CAPTION>
1996 1995
----------- -----------
<S> <C> <C>
Expected life............................................................ 2 2
Interest rate............................................................ 5.94% 5.98%
Volatility............................................................... 30.30% 31.23%
Dividend Yield........................................................... -- --
</TABLE>

TREASURY STOCK--On October 26, 1995, Brandon repurchased 100,000 shares of
its common stock for $1,805. In 1990, Brandon's Board of Directors had
authorized the repurchase of up to $2 million of common stock as market
conditions may warrant. The aggregate number of shares repurchased through
October 26, 1995 were 116,700 for a total consideration of $1,923. Such treasury
stock was canceled upon consummation of the merger.

BRANDON EMPLOYEE STOCK PURCHASE AND DIVIDEND REINVESTMENT AND STOCK PURCHASE
PLANS--Under the terms of Brandon's 1993 Employee Stock Purchase Plan, eligible
employees could purchase Brandon's common Stock through authorized payroll
deductions. The Employee Stock Purchase and Dividend Reimbursement and Stock
Purchase Plans were terminated upon consummation of the merger.

A-23
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

10. SHAREHOLDER RIGHTS PLAN

On February 17, 1994, the Company's Board of Directors adopted a shareholder
rights plan to deter coercive or unfair takeover tactics and to prevent a
potential acquirer from gaining control of the Company without offering a fair
price to all of the Company's stockholders. Under the plan, a dividend of one
right (a "Right") per share was declared and paid on each share of the Company's
Common Stock outstanding on April 1, 1994. As to shares issued after such date,
rights will automatically attach to them after their issuance.

Under the plan, registered holders of each Right may purchase from the
Company one one-hundredth of a share of a new class of the Company's Preferred
Stock, $.01 par value per share, at a price of $98.00, subject to adjustment,
when the Rights become exercisable. The Rights become exercisable when a person
or group of persons acquires 15% or more of the outstanding shares of the
Company's Common Stock without the prior written approval of the Company's Board
of Directors (an "Unapproved Stock Acquisition"), and after ten business days
following the commencement of a tender offer that would result in an Unapproved
Stock Acquisition. If a person or group of persons makes an Unapproved Stock
Acquisition, the registered holder of each Right has the right to purchase, for
the exercise price of the Right, a number of shares of the Company's Common
Stock having a market value equal to twice the exercise price of the Right.
Following an Unapproved Stock Acquisition, if the Company is involved in a
merger, or 50% or more of the Company's assets or earning power are sold, the
registered holder of each Right has the right to purchase, for the exercise
price of the Right, a number of shares of the common stock of the acquiring
company having a market value equal to twice the exercise price of the Right.

After an Unapproved Stock Acquisition, but before any person or group of
persons acquires 50% or more of the outstanding shares of the Company's Common
Stock, the Board of Directors may exchange all or part of the then outstanding
and exercisable Rights for Common Stock at an exchange ratio of one share of
Common Stock per Right. Upon any such exchange, the right of any holder to
exercise a Right terminates.

The Company may redeem the Rights at a price of $.01 per Right at any time
prior to an Unapproved Stock Acquisition (and after such time in certain
circumstances). The Rights expire on April 1, 2004, unless extended by the Board
of Directors. Until a Right is exercised, the holder thereof, as such, has no
rights as a stockholder of the Company, including the right to vote or to
receive dividends. The issuance of the Rights alone has no dilutive effect and
does not affect reported earnings per share.

11. TRANSACTIONS WITH BLOCK

Prior to September 25, 1993, the Company's working capital and acquisition
financing were provided by Block. There was no interest charged on intercompany
debt. Effective September 25, 1993, Block formalized this arrangement by (i)
providing a revolving credit facility in the amount of $20,000 to fund the
operating requirements of the Company; (ii) converting $30,000 of intercompany
indebtedness on such date to a term loan, and (iii) contributing $51,289 to the
capital of the Company.

12. COMMITMENTS

Substantially all of the Company's operations are conducted in leased
premises. The Company leases off-site corporate related office space and branch
and regional processing center locations. Total lease expense for the years
ended December 27, 1996, December 29, 1995 and December 30, 1994 was $11,543,
$7,187 and $6,151, respectively.

A-24
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(AMOUNTS IN THOUSANDS, EXCEPT SHARE DATA)

12. COMMITMENTS (CONTINUED)
Future minimum lease payments under noncancellable leases as of December 27,
1996 were as follows:

<TABLE>
<CAPTION>
FISCAL YEAR ENDING
- -------------------------------------------------------------------------------------
<S> <C>
1997................................................................................. $ 9,485
1998................................................................................. 7,598
1999................................................................................. 6,120
2000................................................................................. 4,551
2001................................................................................. 2,172
Thereafter........................................................................... 1,178
</TABLE>

Additionally, the Company had outstanding irrevocable letters of credit of
approximately $20.2 million (same as fair value). These letters of credit, which
expire in 1997, collateralize the Company's obligation under certain workers'
compensation insurance programs and an earnout provision relating to an
acquisition.

13. CONTINGENCIES

The Company in the ordinary course of its business is threatened with or
named as a defendant in various lawsuits. It is not possible to determine the
ultimate disposition of these matters; however, management is of the opinion
that the final resolution of any threatened or pending litigation is not likely
to have a material adverse effect on the financial position or results of
operations of the Company.

QUARTERLY FINANCIAL DATA
(UNAUDITED--AMOUNT IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

The following is a tabulation of the quarterly results of operations for the
years ended December 27, 1996 and December 29, 1995.

<TABLE>
<CAPTION>
1996 QUARTER ENDED 1995 QUARTER ENDED
-------------------------------------------- --------------------------------------------
DEC. 27, SEPT. 27, JUNE 28, MAR. 29, DEC. 29, SEPT. 29, JUNE 30, MAR. 31,
1996 1996 1996 1996 1995 1995 1995 1995
--------- ----------- --------- --------- --------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Revenues from services........ $ 306,527 $ 294,711 $ 281,188 $ 264,725 $ 245,203 $ 221,948 $ 203,444 $ 193,652
Gross profit.................. 94,521 91,160 86,684 78,997 75,608 66,509 62,845 59,116
Earnings before taxes......... 17,237 13,970 4,069 9,836 12,407 11,304 9,628 8,465
Income taxes.................. 7,192 6,143 4,415 4,347 5,212 4,927 4,159 3,773
Net earnings (loss)........... 10,045 7,827 (346) 5,489 7,195 6,377 5,469 4,692
Net earnings (loss) per common
and common equivalent
shares....................... $ 0.53 $ 0.49 $ (0.02) $ 0.35 $ 0.46 $ 0.41 $ 0.35 $ 0.30
Share price:
High.......................... 45 5/8 44 50 1/4 40 3/4 35 3/8 28 1/8 31 29 3/4
Low........................... 34 36 1/2 34 3/4 34 1/4 26 1/2 23 5/8 23 1/8 23 1/4
</TABLE>

A-25
<PAGE>
PROXY

INTERIM SERVICES INC.
ANNUAL MEETING THURSDAY, MAY 22, 1997

THIS PROXY IS SOLICITED BY THE BOARD OF
DIRECTORS OF THE CORPORATION.

The undersigned stockholder of Interim Services Inc., a Delaware
corporation, appoints ROY G. KRAUSE and JOHN B. SMITH, or either of them, with
full power to act alone, the true and lawful attorneys-in-fact of the
undersigned, with full power of substitution and revocation, to vote all shares
of stock of said Corporation which the undersigned is entitled to vote at the
annual meeting of its stockholders to be held at the Corporate Service Center of
the Corporation at 2050 Spectrum Boulevard, Fort Lauderdale, Florida 33309, on
Thursday, May 22, 1997, at 10:00 a.m., Fort Lauderdale time, and at any
adjournment thereof, with all powers the undersigned would possess if personally
present, as indicated on the reverse side hereof.

YOU ARE REQUESTED TO COMPLETE, SIGN AND RETURN
THIS PROXY PROMPTLY

(CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE)

- -------------------------------------------------------------------------------
-FOLD AND DETACH HERE-

April 10, 1997

Dear Stockholder:

The annual meeting of stockholders of Interim Services Inc. will be held at the
Corporate Service Center of the Corporation at 2050 Spectrum Boulevard, Fort
Lauderdale, Florida at 10:00 a.m., Fort Lauderdale time, on Thursday, May 22,
1997. At the meeting stockholders will elect two directors and act upon four
proposals to (i) ratify the appointment of Deloitte & Touche for the fiscal
period ending December 26, 1997; (ii) approve the Company's 1997 Long-Term
Executive Compensation and Outside Director Stock Option Plan; (iii) approve the
Company's 1997 Employee Stock Purchase Plan; (iv) approve the Company's
Incentive Plan for 162(m) Executives.

It is important that your shares are represented at this meeting. Whether or
not you plan to attend the meeting, please review the enclosed proxy materials,
complete the attached proxy form below, and return it promptly in the envelope
provided.

Enclosures.

<PAGE>

THIS PROXY WILL BE VOTED "FOR" ITEMS #1,#2,#3,#4 AND 5 IF NO INSTRUCTION TO THE
CONTRARY IS INDICATED. IF ANY OTHER BUSINESS IS PRESENTED AT THE MEETING, THIS
PROXY WILL BE VOTED IN ACCORDANCE WITH THE RECOMMENDATION OF MANAGEMENT.

PLEASE MARK X
YOUR VOTES AS
INDICATED IN
THE EXAMPLE

1. Election of Directors, Nominees: WILLIAM F. EVANS AND CINDA. A HALLMAN

FOR ALL NOMINEES WITHHOLD INSTRUCTION: To withhold authority to vote
LISTED ABOVE AUTHORITY for any individual nominee, write that
(EXCEPT AS MARKED TO VOTE FOR nominee's name in the space below.
TO THE CONTRARY). ALL NOMINEES
LISTED ABOVE -----------------------------------------
/ / / /

2. Ratification of the appointment of Deloitte & Touche as the Company's
independent auditors for this fiscal period ending December 26, 1997.

FOR AGAINST ABSTAIN

/ / / / / /

3. The approval of the Company's 1997 Long-Term Executive Compensation and
Outside Director Stock Option Plan.

FOR AGAINST ABSTAIN

/ / / / / /

4. The approval of the Company's 1997 Employee Stock Purchase Plan.

FOR AGAINST ABSTAIN

/ / / / / /

5. The approval of the Company's Incentive Plan for 162(m) Executives.

FOR AGAINST ABSTAIN

/ / / / / /

6. On any other matter that may be submitted to a vote of stockholders.

Dated: _____________________________________________, 1997

__________________________________________________________
Signature

__________________________________________________________
Signature if Held Jointly

Please sign name or names as appearing on this proxy. If signing as a
representative, please include capacity.